Symantec’s spin-out of Veritas took a twist today when The Carlyle Group and other investors agreed to purchase Veritas for $8 billion. That’s $5.5 billion less than Symantec paid for Veritas in a 2005 blockbuster acquisition.
Symantec was preparing to spin-out its Veritas backup and storage management division with a target date of January 2016 for Veritas to become a separate public company. The Carlyle sale is expected to close around the end of 2015, so the timeline should remain about the same. Veritas will be private under Carlyle’s ownership.
The move wasn’t surprising because it was known that Symantec was shopping Veritas while planning the spin-out. Along with an $8 billion cash payout, Symantec CEO Michael Brown said the sale “helps us simplify the separation process.”
During a conference call today to discuss the deal and quarterly earnings, Brown emphasized that the sale will be good for Symantec shareholders. It’s unclear how it will affect Veritas, which was already far along the path of preparing to become its own company.
The Carlyle Group did name the new leaders of Veritas. Bill Coleman will be CEO and Bill Krause will become chairman when the deal closes. Coleman was a founder and CEO of BEA Systems, an enterprise software vendor acquired by Oracle in 2008. He also was CEO of cloud software vendor Cassatt, and an executive at Sun and Visicorp. He has been a partner with venture capitalist firm Alsop Louie Partners the past five years.
Krause is a Carlyle executive and board partner for VC firm Andreessen Horowitz, and director of SAN switching vendor Brocade and several other companies. He is former CEO of networking vendor 3Com, which Hewlett-Packard acquired.
A quote from Carlyle’s press release on the deal makes it sound as if Coleman will proceed with the strategy Veritas has been implementing. Coleman said he looks forward to partnering with current Veritas GM John Gannon, chief product officer Matt Cain and VP of worldwide sales Brett Shirk “and the rest of the existing leadership team to establish Veritas as a free-standing company and reinvigorate our culture to drive innovation and value creation.”
Brown said revenue from Symantec and Veritas took a hit last quarter, and he blamed it on a sales force realignment along with executives performing due diligence for the Veritas sale.
Information management revenue of $587 million fell 10 percent from last year, despite double-digit growth in NetBackup software and appliances.