Symantec share price nose dives after rumored Broadcom biz gobble taken off the menu

Looks like the ailing security shop priced itself out of an acquisition by chip giant

By Kieren McCarthy in San Francisco


Symantec's share price has plunged on reports that its planned merger with Broadcom has fallen through.

According to CNBC, several sources have confirmed that the deal is off after Symantec insisted on too high a price – $28 a share – to sell up. That report, and the claim that it was asking too much, appear to have been validated when Symantec's stock price immediately dropped 12 per cent and has continued to slowly slide all morning. At the time of writing, it is down 15.5 per cent at $21.64.

Adding insult to injury, Broadcom's share price has risen slightly – up 1.7 per cent at the time of writing – demonstrating that as far as analysts are considered Symantec is not exactly a shining tech target.

Its CEO Greg Clark stepped down in May with no permanent replacement; something Symantec has had to get used to, losing five chief executives now in eight years. The security shop is also plagued with allegations of dodgy accounting, into which investigations are ongoing.

That said, when reports of the proposed deal first appeared, Symantec's price went up 18 per cent and Broadcom's went down 4 per cent, so Symantec has become mildly more interesting to the markets, presumably because they suspect someone else may look at buying the legacy security outfit.

Symantec offloads its certs and web security biz to DigiCert


The Broadcom/Symantec love-in was short-lived. Just two weeks ago, it was reported that the two companies were in "advanced talks" with Broadcom planning to pay $15bn for control.

What went wrong? Well, CNBC reports that Symantec wanted $28 a share and Broadcom thought that was too high. Bloomberg has added more context by reporting that the deal was set higher than that – $28.25 – but Broadcom insisted on a drop of $1.50 – ie: down to $26.75 a share – after it had done its due diligence. Symantec wasn't happy with that and walked away. The deal was due to be announced this week.

The rationale for the deal was that Broadcom wants to get into higher margin software, a year after it bought CA Technologies for $18.9bn. Broadcom has had a relatively tough run of late as semiconductors slumped 12 per cent year-on-year in the first quarter of this year.

Broadcom CEO Hock Tan is also under pressure to justify his wage packet: he was the highest paid exec in the US in 2017 with a salary of $103.2m a year. Symantec will be the second failed takeover in the past year after Broadcom missed out on Qualcomm after US authorities blocked the deal, citing national security concerns. ®

Sign up to our NewsletterGet IT in your inbox daily


More from The Register

Accenture pays for CSS injection from Symantec parent Broadcom: Yep, it bought its cybersecurity services arm

Price tag undisclosed but we're guessing it won't have made seller rich

When the chips are down, buy a software biz: Broadcom snaffles Symantec for $10.7bn

Legacy security outfit to vanish into the 'rightsizing' grinder

Pull up your SoCs, it's rubber-glove time: European Commission to probe Broadcom over microchip supply deals

Updated Casts an eye over biz's agreements with 7 of its main customers

Hundreds of millions of Broadcom-based cable modems at risk of remote hijacking, eggheads fear

Updated It's got a name and logo so it's serious, you guys

What will $15.5bn buy you? For Broadcom, it could nab itself a whole Symantec

Chip designer to make another foray into enterprise software... troubled security outfit in its sights

Broadcom billionaire Henry Nicholas and pal on drugs rap cough up $1m to avoid the clink

Charges for chip giant cofounder and pal downgraded in special plea deal

Chip flinger Broadcom says its software unit's doing great. Wait, what?

CA performing 'extremely well' under new management, says new management. As for wireless semiconductors...

Bloodbath as Broadcom slashes through CA Technologies personnel

I liked it so much, I bought the company – and fired 40 per cent, 2,000, of its US staff

Broadcom, its baffling $19bn CA biz gobble, and the fake Pentagon memo crying about national security

Senator calls for real probe into 'Chinese-controlled' outfit

Qualcomm disappointed by Broadcom's 'inadequate' shrinking package

Snapdragon giant confirms: Size really does matter


Reduce Redis Enterprise Deployment Cost, Complexity with Intel Optane DC Persistent Memory

Intel has prepared this Optane DC persistent memory kit to help you reduce Redis Enterprise deployments cost and complexity with 2nd generation Intel Xeon scalable processors and Intel Optane DC persistent memory.

Evolving Datacenters without Complexity

In this session, we’ll talk about how IT leaders are advancing the capabilities of their datacenters to rise to today’s challenges. Our guest speaker, Chris Bradford, Product Manager at DataStax will bring first-hand expertise to a discussion with The Register host Elena Perez.

Who Needs Malware?

Learn how fileless techniques work and why they present such a complex challenge.

Network Detection & Response for MITRE ATT&CK Framework

Read the white paper for a high-level view of how enterprise NTA with ExtraHop Reveal(x) detects and enables investigation of a broad range of the TTPs catalogued by MITRE ATT&CK!