The security company Symantec is all set to acquire Blue Coat, a security provider, in a deal that is worth more than $4.5 billion. This deal will create an even broader portfolio of security services under one umbrella, which is sure to benefit customers around the world.

This deal is expected to close sometime in the third quarter of this year. It will also result in the CEO of Blue Coat, Greg Clark, taking up the same position at Symantec. This is an unusual move because we typically see the CEO of the acquiring company heading up both enterprises, but the deal to install Clark is what prompted Blue Coat to agree to this acquisition.

 

 

Symantec has been on the lookout for a new CEO for a few months, with Michael Brown stepping down from the role imminently after poor financial performances in the past few quarters. Ajei Gopal is currently serving as the company’s temporary COO and President.

It is certainly an interesting acquisition because this deal combines the unique services offered by both companies. Symantec is a leader in offering threat monitoring services, while Blue Coat is famous for its network and cloud security services. Combining these services should provide an even broader scope of protection for customers because they can gain protection through different cyber endpoints, along with email, networks, servers and the general web.

With Symantec and Blue Coat set to combine, the new company should have around 3,000 different engineers and research staffers, along with nine unique Threat Response Centers around the United States. The combined companies will also boast a revenue of approximately $4.5 billion at the end of the 2016 fiscal year. A vast majority of this revenue comes from enterprise security.

Even though companies are more fearful of security breaches than they have been in the past, Symantec has struggled to translate this feeling of anxiety into real improvements in their financial performances. The company ended the fourth quarter of its fiscal year with only $850 million in revenue, which is a three percent decline from the same period one year ago. Their annual income also fell by around 10 percent.

Symantec is financing this transaction through cash and new debt. One of the biggest investors in the company, Silver Lake, is set to double their investment to around a billion dollars. Bain Capital is also reinvesting around a quarter of a billion dollars through convertible notes.