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Symantec reports $.17 per share, will sell Veritas for $8 billion

Staff writer |
Symantec has entered into a definitive agreement to sell its information management business Veritas, to an investor group led by The Carlyle Group together with GIC and other expected co-investors for $8 billion in cash.

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The transaction, which was unanimously approved by Symantec board, is expected to close by January 1, 2016.

Symantec reported a net income of $117 million, or 17 cents per share. Non-GAAP earnings were 40 cents per share on a revenue of $1.499 billion.

Symantec CEO Michael Brown said in the report that revenue for Q1 was actually flat when "adjusting for currency and an extra week in the June 2014 quarter." The balance sheet depicted a 14 percent drop year-over-year from $1.735 billion in revenue for the first quarter of fiscal 2015.

Upon closing of the transaction, Symantec expects to receive approximately $6.3 billion in net cash proceeds, subject to certain customary post-closing adjustments. Symantec will take a comprehensive and disciplined approach to capital deployment focused on both returning capital to shareholders and investing in the business.

The Symantec Board has authorized a $1.5 billion increase to its existing share repurchase program, bringing the total to $2.6 billion, with $2 billion expected to be returned to shareholders over the 18 month period following the close of the transaction.

The board has also determined that Symantec will maintain its quarterly cash dividend of $0.15 per common share, which represents an overall increase to the company’s dividend payout ratio post-separation.

Between its dividend and share repurchases, Symantec expects to return about 120% of its after-tax domestic cash proceeds from the sale to its shareholders.

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