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Fireworks Start Early for Symantec with Broadcom Acquisition Talks

Source:

Internet security leader Symantec's shares are soaring today on reports of advanced merger discussions with chip maker Broadcom.

Symantec Corp. (SYMC:NASDAQ) shares are up more than 13% on high volume today after reports of advanced merger discussions with Broadcom Inc. (AVGO:NASDAQ). Neither Symantec nor Broadcom have released any details, but the market action indicates that a deal may be imminent. Speculation in the markets today is that Broadcom will pay a price between $2528/share for Symantec or about $15.5$17.6 billion. There are not any details yet regarding whether this would be a merger of shares, a cash deal or some combination.

With a market cap of $119.6 billion, approximately 10 times Symantec's $13.6 billion, Broadcom appears to be looking to diversify and make a major push into cybersecurity and software. Bloomberg reported Tuesday night that serious talks were underway between the two companies. The report indicates that Broadcom would have to pay a pretty high price for Symantec.

Symantec Corp. is a leading cybersecurity firm whose products are used by individuals, companies, governments and organizations worldwide. The company's Norton and LifeLock product suites provide services to more than 50 million users.

Broadcom is a designer, developer and global supplier of semiconductor devices for enterprise and data center networking, servers and storage systems, home connectivity, set-top boxes, telecommunication equipment, smartphones, and much more.

Symantec shares traded more than 23 million shares in the first hour of trading, which is triple the 50-day and 200-day average daily volume. The firm's shares are currently trading at $25.02/share, up $2.92/share (+13.20%) over Tuesday's close of $22.10. As the potential acquirer, Broadcom's shares are down more than $11.07 (-3.72%) off the July 2nd close of $295.33 per share in a holiday shortened trading day.

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