The deal is part of a larger effort on Broadcom’s part to diversify its business, with the company aiming to become a leading global provider of IT infrastructure solutions across both hardware and software. The acquisition follows Broadcom’s recent acquisitions of data center and networking solutions specialist Brocade, and of mainframe software specialist CA Technologies.
Symantec specializes in digital security and antivirus software, and has promoted post-password authentication solutions; as part of Broadcom, its enterprise security division will be branded “Norton Lifelock”.
As Forbes reports, Symantec’s enterprise security division generated about 50 percent of its revenues in its most recent fiscal quarter, at $2.5 billion, but was responsible for only 10 percent of its operating income. Speaking with Wall Street analysts after the announcement of Broadcom’s acquisition deal, Symantec CEO Rick Hill emphasized that Broadcom is offering “$10.7 billion in cash for approximately 10% of our operating income.”
The deal’s announcement comes after the US government blocked Broadcom’s attempt to acquire Qualcomm last year over national security concerns. It also arrives at a volatile time given the escalating trade war between the US and China, but with Broadcom having relocated its headquarters from Singapore to San Jose last year, the company’s proposed acquisition will not be subject to the US’s Committee on Foreign Investment, though it is still subject to antitrust approval, as CNN Business notes.