On Tuesday, Bloomberg reported Broadcom would sell the enterprise cybersecurity assets it acquired from Symantec last year to Accenture. Notably, the chipmaker announced plans to purchase the utility segment in August 2018 for $10.7 billion. Neither Broadcom nor Accenture has revealed the financial terms of their deal, but it’s expected to close in March.
Why Accenture Wants Symantec’s Old Cybersecurity Unit
Founded in 1989, Accenture is a multidisciplinary professional services firm with $130 billion in market capitalization. In the last decade, the firm formed partnerships with the likes of Apple and has won half-billion-dollar contracts from the U.S. government. Presently, the conglomerate maintains six security operation centers across the globe.
Before its deal with Broadcom, Accenture Security had a $2+ billion run rate.
With its latest transaction, the company will acquire a wealth of telemetry and 300 skilled employees. As such, Accenture will increase its enterprise digital threat assessment capability. In a press release, Kelly Bissell, senior managing director of the firm’s security unit, said the acquisition would help it craft bespoke cybersecurity solutions for its clients.
Software analyst Anurag Rana told Bloomberg that buying Symantec’s old enterprise division will help Accenture’s Security become more multifaceted, and therefore, more profitable.
Why Broadcom Sold Off Its Cybersecurity Software Holdings
It’s worth noting Broadcom did not issue a public statement regarding its selloff of the business it bought from Symantec. Presumably, the chipmaker did not see long-term value in its recent acquisition. However, at the time it bought its cybersecurity subsidiary, it predicted the segment would generate $2 billion in revenue annually.
Bloomberg noted Broadcom CEO Hock Tan has made it his signature to acquire thriving “franchises” to generate new income streams. Besides, the executive also has a reputation for promptly discarding divisions that don’t meet expectations.
Nevertheless, the semiconductor corporation’s move to sell off its cybersecurity unit probably doesn’t represent a change in its overall strategy. In recent years, the firm has dedicated billions to establishing its software business. Indeed, the Burn-In reported in December, the firm is looking to sell off its radiofrequency chip segment to bolster its non-hardware division.
Instead, Broadcom might’ve sold its Symantec assets because it found a similar concern that better matches its interests. Indeed, earlier this month, the chipmaker announced plans to buy a cybersecurity company called Bay Dynamics. Moreover, the firm’s new acquisition happens to specialize in preemptive neutralization of threats presented by cybercriminals.