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Broadcom Negotiating to Buy Symantec: MSSP Implications

Broadcom’s apparent bid to acquire Symantec may have major implications for the MSSP (managed security services provider) market.

Indeed, while Symantec’s overall enterprise cybersecurity software business has struggled, the company also is one of the world’s Top 100 MSSPs. And that begs the question: If Broadcom actually does acquire Symantec, will the MSSP business be retained or spun-off as part of the deal?

Broadcom has been known to buy enterprise assets and then quickly spin off pieces of the acquired businesses. One example involves Broadcom buying CA Technologies for $18.9 billion and then selling off a business unit called Veracode — to Thoma Bravo for $950 million.

Potential Broadcom Acquisition of Symantec: Top 100 MSSP Implications

Still, history may not repeat itself. If Broadcom acquires Symantec, it makes sense on paper to retain the Top 100 MSSP business unit because it largely involves direct sales to enterprise customers, recurring revenue engagements, and a strong dependence on Symantec’s underlying cybersecurity software, MSSP Alert believes.

If a deal surfaces, Broadcom will need to move quickly to strengthen Symantec’s overall business. Indeed, Symantec has suffered major executive turnover in the past year. The company was late to cloud- and mobile-centric cybersecurity services, and also faces intense competition from next-generation endpoint protection providers.

CrowdStrike recently completed a very successful IPO. Fast-growth startups such as AlienVault and Cylance both got acquired ahead of potential IPO pursuits. AT&T and BlackBerry, respectively, snapped up those companies in 2018. Folks are also watching Carbon Black and Cybereason for ongoing clues about the cyber market’s overall health.

MSSP Alert has reached out to Broadcom and Symantec for comment about the alleged merger and acquisition discussions, but we have not independently confirmed M&A talks between the two companies.

Rumors about the potential Broadcom-Symantec deal surface roughly one month before the massive Black Hat USA 2019 cybersecurity conference in Las Vegas.

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