Symantec Corp today announced that it has entered into a definitive agreement with an investor group led by the Carlyle Group to sell Veritas, Symantec’s information management business. Symantec and Veritas announced last October that they would be splitting into two independent companies. Symantec’s board of directors unanimously approved the transaction. The transaction is expected to close on January 1, 2016 for $8 Billion in cash. The transaction is subject to regulatory approvals and other closing conditions.
Symantec plans on using the cash to invest further in the business and return capital to its investors. Symantec will be adding $1.5 Billion to its share repurchase program, bring the total to $2.6 Billion. Symantec expects $2 Billion to be returned to shareholders over the next 18 months following the close of the sale. Symantec will continue to pay a cash dividend of $0.15/common share. With the dividend and share repurchase program Symantec expects to return about 120% of its after-tax domestic cash proceeds from the sale to its shareholders.
When considering the sale agreement, the board of directors consider aspects such as:
Bill Coleman and Bill Krause will become CEO and Chairman, respectively, of Veritas upon closing of the transaction. Each company plans on continuing to build on its unique strengths and assets. Symantec will continue to focus on cybersecurity and Veritas will continue to focus on information management.
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