Contact: Scott Denne
Symantec’s board has fired Steve Bennett, the CEO who brought the security vendor’s vigorous M&A practice to a halt. During his tenure, beginning in July 2012, Symantec bought just one company, compared with an average of four deals per year for the preceding decade.
Under Bennett’s watch, Symantec purchased only PasswordBank Technologies, an identity management firm that we estimate had $2m in annual revenue at the time. According to The 451 M&A KnowledgeBase, which tracks back to the start of 2002, the only other year Symantec acquired one or fewer companies was 2011, when it spent $410m on e-discovery vendor Clearwell Systems.
It’s hard to fault Symantec’s recent management for its M&A reluctance. The company built itself through acquisitions, but its biggest bet proved one of its worst. In 2004, it paid $13.5bn for storage software provider Veritas and every Symantec CEO since then has struggled with the legacy of that deal. Symantec’s current market cap, at $12.7bn, sits below what it paid for Veritas and it has taken nearly a decade to grow Veritas’ sales by just 25%.
Regardless of the failure of the Veritas buy, Symantec has been increasingly inactive as its competitors grabbed seats in several markets. Take security event and infrastructure management. Surveys of security customers by TheInfoPro, a service of 451 Research, show that Symantec ranked third in that category in mid-2011, shortly after HP spent $1.65bn on market leader ArcSight. Subsequent deals by IBM (Q1 Labs) and McAfee (NitroSecurity) pushed Symantec further down in the rankings.
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