Apps & Software
Symantec Pays $2.3 Billion for ID Security Firm LifeLock
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Late Sunday afternoon cyber security firm Symantec Corp. (NASDAQ: SYMC) and LifeLock Inc. (NYSE: LOCK) announced that they had reached a definitive agreement for Symantec to acquire LifeLock for about $2.3 billion in cash, or $24 per LifeLock share. The deal is expected to close in the first quarter of 2017, subject to a LifeLock shareholder vote and other customary closing conditions.
Symantec said it will finance the transaction with cash on the books and $750 million in new debt. In a sweetener to existing shareholders, the company also said it has increased its stock buyback authorization by $500 million to about $1.3 billion with a target of up to $500 million in new buybacks by the end of fiscal 2017 ending in March.
The transaction is not expected to have a material impact on Symantec’s 2017 financial results and the company reaffirmed its prior 2017 guidance for adjusted revenues of $4.04 to $4.12 billion and adjusted earnings per share of $1.12 to $1.18. Symantec expects the acquisition to have a positive effect on earnings in fiscal year 2019.
Symantec CEO Greg Clark said:
As we all know, consumer cybercrime has reached crisis levels. LifeLock is a leading provider of identity and fraud protection services, with over 4.4 million highly-satisfied members and growing. With the combination of Norton and LifeLock, we will be able to deliver comprehensive cyber defense for consumers. This acquisition marks the transformation of the consumer security industry from malware protection to the broader category of Digital Safety for consumers.
Symantec’s shares traded up about 3.3% Monday morning at $24.53 in a 52-week range of $16.14 to $25.72. The consensus 12-month price target on the stock was $26.48 before Sunday’s announcement.
LifeLock’s shares traded up about 15.4% at $23.95 in a 52-week range of $9.13 to $23.98, a high reached early this morning. The consensus 12-month price target on the stock was $19.75.
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