2019-08-08 by W.M.
Broadcom to acquire Symantec’s enterprise security software business
Previously, Broadcom acquired network equipment maker Brocade in 2017 and enterprise security company CA Technologies in 2018. The company said following the Symantec acquisition in the first quarter of 2020, it expects 29% of its total revenue to come from software, up from a projected 22% in 2019.
Broadcom aims to “build one of the world’s leading infrastructure technology companies across hardware and software,” CEO Hock Tan said on a call with analysts on Thursday.
The Trump administration argued that the proposed takeover would cause Qualcomm to fall behind in next-generation 5G technology, allowing competitors such as China’s Huawei to gain an edge. It was concerned that Broadcom’s plan to borrow $100 billion for the deal meant it would have had to squeeze cash out of Qualcomm, leaving less money for 5G research and development.
It is unclear if the Committee on Foreign Investment in the United States, which was involved in blocking the Qualcomm deal, will review Broadcom’s Symantec deal. CFIUS did not immediately respond to a request for comment.
Symantec’s consumer business will remain separate and be rebranded.
Symantec’s shares were up nearly 3% in after hours trading Wednesday. Broadcom’s were up less than half a percent.
Washington has urged its allies to keep the Huawei’s telecom equipment out of their 5G networks, and in May banned US companies from selling it components without a license. Trump announced on June 29 that he would relax the ban but it is not yet known what impact that will have.