Report: Symantec-Veritas Split Hits Bump In Road As Banks Pull Financing

Just a handful of months away from the sale of its storage business to private equity, Symantec reportedly has hit a bump in the road as two banks pull funding from the deal.

Lenders at Bank of America and Morgan Stanley were originally lined up to provide $5.5 billion in loans and bonds to underwrite the debt from the deal but have now suspended those talks due to investor hesitation, a Bloomberg report said Tuesday, citing unnamed sources.

The report comes on the heels of multiple executive departures from the company, including Executive Vice President and General Manager of Global Sales and Operations Adrian Jones in October and, more recently, Vice President of Global Channel Programs and Sales Tom LaRocca and Vice President, Global Sales Strategy and Field Enablement Sean Maxwell.

[Related: Symantec Loses Another Top Channel Executive; Is The Channel Group's Future In Jeopardy?]

Symantec and Veritas, the company's storage division that it bought in 2005, first said they would split in October 2014. But Symantec in August said it would sell Veritas to private equity firm the Carlyle Group for $8 billion instead.

The split is already well under way, with the operational split completed last month and with the full completion of the deal expected Jan. 1.

A Symantec spokesperson said the company doesn't expect the financing challenges will have any effect on the date of the deal closing.

"Symantec continues to expect the sale of Veritas to close by January 1, 2016, as previously announced. The transaction is subject to customary closing conditions, although there is no financing contingency associated with the closing of the sale," a Symantec spokesperson said in an email statement.

Brian Casey, general manager and chief operating officer at Daymark Solutions, a Lexington, Mass.-based Veritas Gold partner, said he wasn't particularly concerned about the report, as most of the hard work to split the company operationally and separate the brands is already complete.

"We think everything will turn out just fine," Casey said. "There's a lot of pieces moving around on the board right now."

That is a good thing, Daymark Solutions' Casey said, as he sees the split overall as a good move for both Symantec and Veritas, as it will allow both parties to drive focus in their investments and go-to-market approaches.

"I think the split is a good thing," Casey said. "It enables both companies to focus on what they're good at and invest in areas that should provide a good return for each respective company."

PUBLISHED NOV. 18, 2015