In an effort to turn the company around, security vendor Symantec has agreed to purchase web and cloud security firm Blue Coat Systems Inc. for $4.65 billion in cash.
Blue Coat CEO Greg Clark will step into the chief executive role at Symantec, replacing Mike Brown, who stepped aside as CEO in April.
Symantec is coming off several tumultuous years, as it faces its fourth CEO in five years, as well as continued attempts to reshape the business with other acquisitions, while simultaneously divesting itself of another part of its business, storage and backup division Veritas.
"Nearly two years ago, we announced our intention to become the leading pure-play security company," said Dan Schulman, chairman of the board for Symantec, in prepared remarks. "The first major step was the divestiture of Veritas." Calling the Symantec acquisition of Blue Coat the "next major leap forward in our journey," Schulman added, "With this transaction, we are uniquely positioned with the scale, product portfolio and security resources necessary to help protect customers against cyberthreats."
Ajei Gopal, Symantec's interim president and COO, said Blue Coat's technology for web and network-based threats, as well as cloud application security, will complement Symantec's own product line. "Our solutions dovetail perfectly, with only a small overlap in our product portfolios," Gopal said. "Furthermore, there is huge leverage in our ability to share our core protection engines and the vast amount of threat data we collect."
Symantec has experienced major changes and high-profile struggles in the past few years: CEO Enrique Salem was fired in 2012 after first-quarter profits dropped 10%; Steve Bennett stepped down in 2014 after more financial struggles; and his replacement, Mike Brown, was forced out from the top spot in April, following disappointing fourth-quarter results. In addition, Symantec sold Veritas last year for $5.5 billion less than they paid for it in 2005.
And Symantec has attracted more than its share of opprobrium lately, including a dangerous flaw in its antivirus software that was described as being as bad as it can possibly get. Last year, Symantec got in hot water with Google when it was discovered that Symantec employees had improperly issued Extended Validation digital certificates for testing for domains owned by Google.
Meanwhile, Blue Coat has been on the opposite track. After being acquired by Bain Capital last year for $2.4 billion, Blue Coat has been busy with its own acquisitions designed to power its growth into the cloud security market. The company acquired Perspecsys, a Toronto-based cloud access security broker, for an undisclosed amount last August, and a few months later, Blue Coat spent $280 million for another CASB startup, Elastica Inc.
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