BY Fraser Tennant
In a combination that will form the world’s largest digital safety platform for consumers and families, Symantec Corp. has announced that it is to acquire LifeLock, Inc. – a transaction with an enterprise value of $2.3bn.
The definitive agreement between cyber security company Symantec (the maker of Norton antivirus software) and LifeLock, a provider of proactive identity theft protection services, is expected to be financed by Symantec via cash on the balance sheet and $750m of new debt.
Once Symantec’s acquisition of LifeLock (for $24 per share) is complete, two business leaders, one in consumer security and the other in identity protection and remediation services, will have been brought together to create the world’s largest consumer security business with over $2.3bn in annual revenue (based on last fiscal year revenues for both companies).
Symantec’s board of directors has also confirmed that it has increased the company’s share repurchase authorisation from approximately $800m to $1.3bn, with up to $500m in repurchases targeted by the end of fiscal 2017.
“As we all know, consumer cyber crime has reached crisis levels,” said Greg Clark, CEO of Symantec. “LifeLock is a leading provider of identity and fraud protection services, with over 4.4 million highly-satisfied members and growing. This acquisition marks the transformation of the consumer security industry from malware protection to the broader category of digital safety for consumers.”
Illustrating the “crisis levels” referenced by Mr Clark is data showing that, in the last year, one third of American citizens and over 650 million people globally were the victims of cyber crime. As a consequence, more and more consumers are becoming concerned about digital safety.
“After a thorough review of a broad range of alternatives, our board of directors unanimously concluded that Symantec is the ideal strategic partner for LifeLock and offers our shareholders a significant premium for their investment, at closing,” said Hilary Schneider, CEO of LifeLock. “Together with Symantec we can deploy enhanced technology and analytics to provide our customers with unparalleled information and identity protection services. We are very pleased to have reached an outcome that serves the best interests of all LifeLock stakeholders.”
The Symantec/LifeLock transaction has been approved by the boards of directors of both companies and is expected to close in the first calendar quarter of 2017, subject to customary closing conditions (including LifeLock stockholder approval).
Mr Clark concluded: “With this combination we will be able to deliver comprehensive cyber defence for consumers.”