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Symantec in talks to sell Veritas storage unit to Carlyle: source

Published 07/07/2015, 07:25 PM
Updated 07/07/2015, 07:35 PM
© Reuters. Carlyle Group co-founder and CEO David Rubenstein participates in the Washington Ideas Forum, in Washington

By Greg Roumeliotis

(Reuters) - Software security company Symantec Corp (O:SYMC) is in talks to sell its Veritas data storage business to private equity firm Carlyle Group LP (O:CG), a person familiar with the matter said on Tuesday.

The exact status of the talks could not be learned. Bloomberg News reported earlier that Symantec was nearing a deal to sell Veritas to Carlyle for between $7 billion and $8 billion, citing people with knowledge of the matter.

The Reuters source asked not to be identified because the negotiations are confidential. Symantec did not immediately respond to a request for comment, while Carlyle declined to comment.

Symantec shares rose 2.64 percent in after-hours trading, after closing up 0.5 percent, at $22.79, in regular trade on the Nasdaq.

Symantec has been seeking buyers for Veritas for several months but interest from potential buyers had been limited because of a tax burden associated with splitting the company.

Symantec had been planning separate its business focused on corporate and consumer security software, which had $4.2 billion in revenue last year, from Veritas, which has about $2.5 billion in revenue. It announced the tax-free spinoff last October.

Investor pressure has been building on legacy technology companies such as Symantec to become more agile and capitalize on faster-growing businesses, whether it's through corporate breakups or divestitures.

In addition to Symantec, Hewlett-Packard Co (N:HPQ) and eBay Inc (O:EBAY) have announced major breakups and spinoffs, and more could be on the way. Activist investor Elliott Management has been pressuring EMC Corp (N:EMC) to sell its stake in VMWare (N:VMW) and has urged Citrix Systems (O:CTXS) to create more shareholder value and sell some of its businesses.

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