Broadcom to buy Symantec's enterprise business for $10.7 billion in cash

After the U.S. stock market closed on Thursday, Broadcom officially announced its acquisition of Symantec's enterprise business for $10.7 billion in cash.

It is reported that after the announcement, Broadcom shares rose 1% in after-hours trading; Symantec shares were suspended after the close but rose 5% when trading resumed a few hours later.

Broadcom has been on an acquisition spree for years. The company tried to buy chipmaker Qualcomm for more than $100 billion, but it failed when U.S. President Trump intervened and blocked the deal. After that, Broadcom acquired software company CA Technologies for nearly $19 billion. The deal with CA Technologies helped Broadcom diversify its business.

The acquisition marks Broadcom's second major bet on software after its purchase of CA Technologies.

Broadcom said the acquisition is expected to generate $2 billion in recurring earnings and the transaction is expected to achieve more than $1 billion in operating cost synergies within 12 months of completion.

Symantec said in a statement that it expects the deal to close by the end of 2019.

In fact, there have been rumors about Broadcom's acquisition of Symantec for a long time. However, according to reports in mid-July, due to differences in the transaction price, the negotiation of Broadcom's acquisition of Symantec has been terminated. Before the negotiation broke down last month, Broadcom had been discussing the purchase of the entire Symantec company.

After the negotiations broke down, the two sides resumed discussions and Broadcom adjusted its acquisition of Symantec to focus on acquiring Symantec's enterprise business that provides services to enterprises.