Symantec Corp. and Broadcom Inc. have halted their discussions for a proposed merger as the two sides couldn’t agree on a price, according to people familiar with the matter. Symantec shares fell as much as 15% to $21.70.
Discussions hit an impasse over the weekend after Broadcom sought to reduce its offer by more than $1.50 per share after determining in due diligence that it was no longer willing to meet their agreed-upon price of $28.25, said the people, who asked to not be identified because the matter isn’t public.
They had been preparing to announce the transaction as soon as Tuesday, one of the people said. At $28.25 per share, Symantec would have been valued at about $17.5 billion.
While talks are off for now, they could be resumed if both parties are able to compromise on price or if Symantec comes under sufficient pressure to re-engage, the people said.
Two weeks ago, Bloomberg News reported that Broadcom was in advanced talks to buy the cybersecurity firm, seeking to expand into the more profitable software business. CNBC earlier reported Monday that the talks were called off, citing people familiar with the matter, after Symantec refused to accept less than $28 per share.
A representative for Broadcom couldn’t immediately be reached for comment, while a representative for Symantec didn’t immediately respond to a request for comment.
Symantec fell 13% to $22.29 at 10:12 a.m. in New York trading, giving the Mountain View, California-based company a market value of $13.8 billion. Broadcom, based in San Jose, California, rose 2.4% to $292.20.
The deal would be Broadcom’s second big bet in software, following its $18 billion takeover last year of CA Technologies. And while some analysts said Symantec would be a perfect fit for Broadcom, others noted that it comes with several challenges, including increased competition, the abrupt departure of its chief executive officer, waning consumer interest in antivirus programs and a financial investigation that ended with restated earnings.
Activist investor Starboard Value LP won three seats on Symantec’s board in September, including one for the firm’s Managing Member Peter Feld.