Broadcom Said to Make Progress on Symantec Deal With Financing, Savings

Broadcom has guaranteed funding and identified cost savings for the acquisition of Symantec in an all-cash deal that could appreciate the cyber-security firm at more than $22 billion including debt, according to individuals knowledgeable about the matter.

The chipmaker received financing commitments from many banks and sees yearly synergy potential of roughly $1.5 billion (approximately Rs. 10,300 crores), stated the people, who asked to not be identified because negotiations are private. An arrangement could be reached around mid-July, though the talks may also still drag on or fall apart, the people said.

Separately, Symantec has drawn interest from the former chief executive officer, Greg Clark, who has teamed up with buyout firms Advent International and Permira Holdings in an effort to muster a competing offer, ” said the people. The group thus far has been unable to compete on cost with Broadcom, which makes the pursuit a long shot, they said.

A takeover of the Mountain View, California-based company would indicate Broadcom’s second huge bet in applications, after its $18 billion purchase a year of CA Technologies. That transaction spurred some investors to express concern that CEO Hock Tan’s acquisition strategy has been stretched too much after playing a crucial role in consolidating from the 470 billion chip market.

That deal also came after San Jose, California-based Broadcom left handed a hostile pursuit of rival chipmaker Qualcomm, when US President Donald Trump blocked the trade citing national security dangers.

Symantec’s shares have gained 13 percent since July 3 later Bloomberg News first reported the takeover talks, providing the company a market value of roughly $15.5 billion. Broadcom has dropped about 4.3% in that period, checking it at about $113 billion.

Symantec plunged on May 10 after a soft forecast and the primary executive’s abrupt departure stoked investor concerns.

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