Symantec Corp. (SYMC) - Get Symantec Corporation Report shares surged Wednesday amid multiple media reports that suggested the cybersecurity firm could be bought by chipmaker Broadcom (AVGO) - Get Broadcom Inc. Report .
Bloomberg and Reuters have both reported talks between the two groups are at an advanced stage, with Broadcom looking to add Symantec's $4 billion in annual sales, led by its Norton and LifeLock product suites, to offset the recent slump in revenues from its semiconductor solutions business. Any agreement to buy Symantec would also add to the group's $37.5 billion in debt following its $18 billion takeover of CA Technologies (CA) - Get CA, Inc. Report last year.
"For us, it's what's makes sense, what's actionable in terms of businesses that are franchises that we see as very sustainable and that we are able to acquire," Broadcom CEO Hock Tan told investors following his company's second quarter earnings last month when asked about potential merger or takeover potential. "But right now, we see a lot of movements, but we -- and we continue to be very interested in opportunities that may present themselves and we continue to be very active in assessing those opportunities."
Symantec shares were marked 14.9% higher Wednesday to change hands at $25.39 each, the highest since April 4 and a level that would give the Mountain View, California-based antivirus software firm a market value of around $15.7 billion.
The move would also offset a May slump of nearly 20% that followed a fiscal 2020 profit warning and the surprise departure of CEO Greg Smith.
Broadcom shares, meanwhile, were seen 4.09% lower at $283.25 each, a move that adds to the chipmaker's concerns that a prolonged U.S.-China trade war, and the extended blacklisting of Huawei Technologies, could disrupt global semiconductor demand.
Looking into 2019, Broadcom said it expects to see full-year revenues of $22.5 billion, well shy of the Refinitiv forecast of $24.31 billion, with around $17.5 billion of the coming from the semiconductor solutions business, a figure that would represent a year-on-year decline.