Symantec in talks to sell its Veritas storage unit to Carlyle

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Symantec HQ

Computer security company Symantec is apparently in talks to sell its Veritas data storage unit to a private equity firm called Carlyle Group, a source familiar with the matter told Reuters on Tuesday.

The nature of the talks could not be determined, but Bloomberg earlier reported that Symantec was close to a deal to sell off Veritas to Carlyle for between $7 billion and $8 billion.

Symantec to sell off Veritas?

Since the rumours, shares in Symantec rose more than 2.6% in after hours trading after closing up 0.5% at $22.79 in regular trading on the NASDAQ.

Symantec has reportedly been looking for a buyer for Veritas for months but interest from buyers had been limited due to a tax burden associated with splitting the company.

Symantec planned to separate its business focused on corporate and consumer security software, which managed to pull in $4.2 billion last year, from Veritas, which has more than $2.5 billion in revenue. The tax-free spinoff was announced last October.

Pressure from investors has been building on technology companies like Symantec to become much more agile and capitalise on growth businesses, through corporate breakups for example.

Besides Symantec, HP and eBay have also announced major breakups and spinoffs and it seems that more could be on the way. Investor Elliott Management has recently been applying pressure to EMC to sell its stake in VMWare and also urged Citrix Systems to sell some of its businesses…

SOURCE: Reuters.

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