Symantec Plans to Split Security, Data Businesses--2nd Update

By Josh Beckerman 

Symantec Corp. has become the latest tech company to split up, announcing plans to form separate publicly traded companies, one focused on security and the other targeting information management.

"Symantec's security and IM businesses each face unique market opportunities and challenges. It has become clear that winning in both security and information management requires distinct strategies, focused investments and go-to market innovation," Symantec President and Chief Executive Michael A. Brown said in a news release Thursday.

Shares of Symantec, down 5% over the past year, rose 1.8% in after-hours trading.

Symantec's security business, which includes the Norton antivirus business, generated revenue of $4.2 billion in the fiscal year that ended in March. Its information management business, which includes data backup and recovery, had revenue of $2.5 billion in that same year.

The company expects to complete the spinoff by the end of next year.

Mr. Brown will be the president and CEO of Symantec, and Thomas Seifert will continue to serve as chief financial officer. John Gannon will be general manager of the new information management business, and Don Rath will be its chief financial officer.

Mr. Brown was named as Symantec's chief executive last month after getting the job on an interim basis in March. Mr. Brown followed Steve Bennett, who had been fired amid sagging revenue and slumping shares. It was the second time that Symantec had dumped a CEO in less than two years.

Symantec also reiterated its guidance for the September quarter. In August, the company said it expected per-share earnings, excluding items, between 40 cents and 44 cents on revenue of $1.6 billion to $1.64 billion.

Symantec becomes the latest big company, including eBay Inc. and Hewlett-Packard Co. in tech, to chose to break up lately, in part because of a belief that operations with different growth profiles are best managed as separate entities.

H-P on Monday said it would split the company into two parts, resulting in one company focused on its personal-computer and printer businesses, and the other selling servers, data-storage gear, software, consulting operations and other services.

Companies including EMC Corp. and PepsiCo Inc. have faced pressure from activist shareholders to split up.

Write to Josh Beckerman at [e-mail]

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