Symantec Corp. share price down, considers to separate its business into two companies

Symantec Corp. may soon follow the example of companies such as Hewlett-Packard and eBay which announced reorganization split-ups in order to make their business more competitive. According to people familiar with the situation, Symantec is considering to divide its businesses into two separate entities.

The people, who asked not to be identified, because the companys intentions are not public yet, reported on October 8th that Symantec, whose market capitalization is more than $16 billion, is in advanced talks to split into two companies, one of which will sell security programs and the other will be focused on data storage. According to the people close to the process, an official announcement may follow in a few weeks.

If the rumors turn out true, the company will join other large U.S.-based companies, which have announced similar moves over the last few weeks. In late September eBay shared its intentions to spin-off its PayPal unit in the upcoming year. Earlier this week Hewlett-Packard also announced that it is dividing into two separate publicly traded companies – Hewlett-Packard Enterprise, which will be focused on enterprise technology, and the other, which will keep the name of the current company, will be concentrated on personal computer systems and printing units.

In September, Symantec appointed its interim Chief Executive Officer Mr. Michael Brown permanently to the position. The company has been trying to bring a new life to its operations and spur growth once again. Revenue fell over the latest financial year and Symantec reported that it expects its revenue to stay unchanged this year as it is struggling to cope with the global PC market contraction, which has affected antivirus software sales as well.

A spokeswoman of Symantec – Ms. Kristen Batch – refused to make any comments on the rumors.

Symantec Corp. settled 2.37% lower on Thursday on the NASDAQ at $23.44 per share, marking a one-year change of -4.99%. The company is valued at $16.18 billion. According to CNN Money, the 20 analysts offering 12-month price forecasts for Symantec Corp have a median target of $25.00, with a high estimate of $30.00 and a low estimate of $18.00. The median estimate represents a +6.66% increase from the last price of $23.44.