The Symantec–DigiCert Deal, Private Equity Firms, and the Tech Space
Symantec’s close relationship with private equity firms
Earlier in this series, we discussed Symantec’s (SYMC) sale of its Website Security business to DigiCert, which marks its recent association with private equity firms. Recently, private equity firms have shown a marked interest in the technology space, as Symantec was on their radar.
Elliott Management, a private equity firm, took a substantial stake in Symantec in early 2016. The firm pushed Symantec to “explore its options” and acquire Blue Coat Systems and LifeLock. Elliott Management, which had a stake in both Blue Coat Systems and LifeLock, acted as an intermediary and enabled Symantec to harness the synergy from these strategic acquisitions.
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Blue Coat Systems, which marked Symantec’s largest acquisition in more than a decade, was offloaded by Thoma Bravo to private equity firm Bain Capital in mid-2015. Bain Capital, which bought Blue Coat for $2.4 billion, sold it to Symantec for $4.5 billion, making a healthy profit in the process.
Private equity firms’ continued interest in the tech space
As more technology startups and companies are rapidly approaching the maturity stage where they make appealing investment opportunities to the private equity model, firms like Thoma Bravo are not hesitant to benefit from this trend.
The chart above shows a gradual rise in Thoma Bravo’s activity since 2008. Private equity firms are known to latch onto opportunities with technology companies facing issues, finding their synergies, and generate a healthy return. Symantec’s shift in focus from an antivirus provider via Norton to a comprehensive cybersecurity player offered this opportunity to private equity firms.