Two Computer Software Firms Plan to Merge : High-tech: Symantec and Peter Norton Computing will make ‘utility’ programs for personal computers.
Symantec and Peter Norton Computing, two makers of personal computer software, said Monday that they have decided to merge in what industry observers called one of the best moves in the always undulating sea of software companies and products.
Symantec, based in Cupertino, and the smaller Norton company, of Santa Monica, both make “utility” software for personal computers. Utility software programs help users manage the functions of their machines, and organize and protect information. Symantec’s products are primarily designed for Apple Computer’s Macintosh line, while Norton is a leader in similar programs for International Business Machines PCs and compatible models using the “DOS” operating system.
The merger, expected to be completed in August, could take Symantec to an estimated $100 million in annual revenue by next year, a plateau that analysts say is critical in dealing with the large corporations that dominate the marketplace for microcomputer software.
Combining the companies solves problems for both.
Norton, a well recognized name in PC software--in part because of the success of the products and in part because of founder Peter Norton’s appearances in billboard and magazine ads for Dewar’s Scotch--was trudging uphill to a public stock offering later this year while attempting to build a sales force large enough to service divergent corporate accounts. Symantec has the sales force but lacked the cache of the Norton name and IBM-compatible products.
The structure of the deal, and history of Symantec’s earlier acquisitions, seems to assure a continuing role for Peter Norton. He will join the board of Symantec and “continue to play an active role in product definition and development,” according to the companies.
However, the future is less clear for Ronald S. Posner, the software industry veteran who ably took over the reins of the Norton company just over a year ago when Peter Norton cast aside the rigors of management.
Posner will remain with the combined companies for three to six months, he said, overseeing the transition. But the presence of Gordon E. Eubanks Jr., Symantec’s forceful chief executive, leaves little room for another manager in Symantec’s executive suite.
In the deal, valued at about $70 million, shareholders of the privately held Peter Norton Computing will receive about 2.9 million shares of Symantec. In over-the-counter trading Monday, Symantec shares closed up $1 at $22.50.
