Broadcom Agreed to Buy Symantec Enterprise Division

Broadcom said it agreed to buy Symantec’s division that serves business customers for $10.7 billion in cash, according to Bloomberg. With this transaction, Broadcom is adding software designed to keep hackers out of corporate systems.

The deal, which is expected to close in Broadcom’s fiscal first quarter ending in January, comes less than a month after the two companies’ discussions for a full merger fell apart over disagreements about the price. The transaction will refocus Symantec on its consumer-facing products, such as the LifeLock identity-protection brand and Norton antivirus software.

The acquisition marks Broadcom’s second big bet in software, following its $19 billion takeover of CA Technologies last year. CEO Hock Tan is spreading the reach of the company he built through acquisitions in the chip industry, and is now using a similar playbook to extract value from software assets that are struggling to grow.

“This transaction represents the next logical step in our strategy following our acquisitions of Brocade and CA Technologies,“ Tan said in a statement. Broadcom will use its sales channels to pitch Symantec products to its corporate customers.

Broadcom said it expects $2 billion in sustainable revenue from the acquisition, which will deliver earnings before interest, tax, depreciation and amortization of $1.3 billion. The company will carve out “more than $1 billion of run-rate cost synergies within 12 months following close,“ it said in the statement. The transaction doesn’t need approval in China.