Symantec Corp. stock jumped over 3 percent in after-hours trading on Thursday following an announcement the company plans to split into two separate publicly traded companies -- one focused on security and the other on information management. The Board of Directors expects to complete the spinoff by the end of December 2015.
Symantec did not immediately respond to a request for comment.
“It has become clear that winning in both security and information management requires distinct strategies, focused investments and go-to-market innovation," Michael A. Brown, Symantec president and chief executive officer, said in a press release.
The Mountain View, California-based company said the separation will allow each company to focus on its unique growth opportunities, reduce operational complexity, enhance strategic flexibility, pursue partnerships and develop independent merger and acquisition strategies.
Symantec, known for its Norton antivirus software, is the latest major tech firm to break itself apart, following in the steps of both eBay Inc. and Hewlett-Packard Co. eBay announced last week it plans to separate its PayPal unit into an independent publicly-traded company in 2015, and Hewlett-Packard said earlier this week the company plans to split its personal computer and printers businesses into one entity, and its enterprise tech arm into another.
Symantec topped Wall Street expectations in August after posting a profit of $236 million, or 34 cents per share, during the company’s fiscal first quarter, compared with $157 million, or 22 cents a share, a year earlier. Revenue rose 1.8 percent to $1.74 billion. Symantec’s security business generated revenue of $4.2 billion in fiscal 2014 and the information management business generated an income of $2.5 billion during the same period.
Brown, who was permanently named CEO in September, will remain the president and chief executive officer of Symantec, and Thomas Seifert will continue to serve as chief financial officer.
"Separating Symantec into two, independent publicly traded companies will provide each business the flexibility and focus to drive growth and enhance shareholder value," Brown said. Shares of Symantec closed Thursday's session down 2.4 percent at $23.44.