Report: Activist Investor Elliott Management Takes Large Stake In Symantec

Symantec has another high-profile investor, with a report emerging late Thursday that activist hedge fund investor Elliott Management has taken a large stake in the security vendor.

Citing unnamed sources familiar with the matter, The Wall Street Journal reported that Elliott Management had ’amassed a big stake’ in the vendor, large enough to now be one of the company’s largest shareholders.

CRN reached out to Symantec for comment, but had not heard back at the time of publication.

[Related: Symantec Partners Cheer $500M Silver Lake Private Equity Investment]

The report comes on the heels of Thursday’s announcement that Silver Lake had made a $500 million investment in the Mountain View, Calif-based vendor. Silver Lake is best known for helping take Dell private in 2013.

News of the strategic investment from Silver Lake shot the company’s stock up 12 percent after hours to a high of $21.49. The Journal report said Elliott Management supported the Silver Lake investment.

Elliott Management is well-known for its technology investments, as well as its habit of publicly pushing those companies to undertake drastic changes. The most recent example of that is Elliott Management’s pressuring of management at aluminum manufacturer Alcoa to split in two, which the company yielded to at the beginning of the month. It also pressed for EMC to spin off VMware as an independent company, a fight that ended this January with the agreement to add two Elliott-approved additions to EMC’s board of directors.

Symantec CEO Michael Brown did not mention a possible investment from Elliott Management on the company’s third-quarter earnings call Thursday night. He did say, however, that the investment from Silver Lake was a ’strong vote of confidence in both our transformation, as well as our future as a world leader in cybersecurity.’

Partners were wildly supportive of the Silver Lake investment in Symantec, calling it a ’validation’ of and a ’vote of confidence’ in the company’s strategy.

’I believe Silver Lake’s investment is validation around the steps Symantec and its leadership is taking,’ Jason Eberhardt, vice president of strategic alliances at Chicago-based Symantec partner Conventus, said in an email to CRN.

Wade Wyant, president and founder of ITS Partners, a Grand Rapids, Mich.-based Symantec partner, said he would rather see an investment from private equity than a large company, such as Hewlett-Packard Enterprise or Cisco Systems, purchasing the security vendor outright.

However, partners also worried about the possible implications of a private equity investment from a company like Elliott Management. One partner executive, who did not want to be named, said he worried that a big investment from an activist investor or other private equity firm could split up the company or sell pieces of the business in a way that isn’t favorable to partners.

However, the partner did acknowledge that it could be a positive move as well, depending on what actions are ultimately taken.

Symantec stock was still up, even after the Journal report emerged. At the time of publication, the stock was up about 5 percent to $20.03.