Symantec Corp said it would acquire U.S. identity theft protection services company LifeLock Inc for $2.3 billion, in a deal that it hopes will prop up sales at its Norton cybersecurity unit.
Symantec's security software often comes bundled with personal computers. As a result, the company has suffered as consumers use mobile devices more than traditional computers. While Norton remains profitable, its sales have been falling.
"(Norton) had been declining with the declines in PC market share. This acquisition brings $660 million in revenue to the consumer business and returns it to longer sustainable growth," Symantec Chief Executive Greg Clark said in an interview.
Symantec's purchase of LifeLock is in line with its efforts to diversify its offerings. In August, it bought Blue Coat Inc, which helps firms maintain security over the internet, in a $4.65 billion deal. Clark previously held the top job at Blue Coat, and made the switch after the deal closed.
Based in Tempe, Arizona, LifeLock offers services such as monitoring new account openings and credit-related applications in order to alert consumers about unauthorised use of their identity.
It also works with government agencies, merchants and creditors to remediate the impact of identity theft.
Fran Rosch, executive vice president of Norton Business Unit, said that Symantec had dabbled in identity security but had nowhere near Lifelock's 4.4 million members.
"We had to extend our value proposition. It was a no brainer for us to get back to growth," Rosch said.
Symantec expects to finance the transaction with cash on balance sheet and $750 million of new debt.
Symantec was advised by Citigroup and JP Morgan, along with Bank of America, Barclays Plc, and Wells Fargo. LifeLock was advised by Goldman Sachs.
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