A major software security firm is buying a leading identify theft prevention service. Symantec, which produces Norton anti-virus software, is acquiring LifeLock in a deal valued at $2.3 billion.
The boards of directors of both companies have already signed off but LifeLock shareholders will have the final say. Assuming they approve and other customary closing conditions are met, the deal should close in the first quarter of next year.
The acquisition marks the continued expansion of Symantec beyond the traditional anti-virus software products that fueled its initial growth. In an interview with Reuters, Symantec CEO Greg Clark said sales of Norton products have faced headwinds in recent years because of a decline in the number of personal computers in homes and offices.
Symantec said its acquisition of LifeLock will combine a leader in consumer security with a leading provider of identity protection and remediation services. It says the result will be the world’s largest consumer security business, providing a wide ranges of services and earning over $2.3 billion a year in estimated revenue.
New dimension to protection
“People’s identity and data are prime targets of cybercrime. The security industry must step up and defend through innovation and vigilance,” said Dan Schulman, Symantec Chairman. “With the acquisition of LifeLock, Symantec adds a new dimension to its protection capabilities to address the expanding needs of the consumer marketplace.”
There's little question that protecting against cyber crime is a growth industry. An estimated one-third of U.S. consumer have been victims of some sort of hack. As consumer concern about the threat grows, the industry has expanded its services.
LifeLock offers identify theft services, checking clients' credit for new account openings and credit applications. It also offers services to help consumers recover from an identity theft.
In the previous decade some of its marketing practices ran afoul of federal regulators. As recently as last year the Federal Trade Commission charged that Lifelock violated a 2010 settlement in which it agreed to stop making deceptive claims about its identity theft protection service.
For its part, LifeLock sees a merger with one of the largest computer security firms as a win-win for both companies. LifeLock CEO Hilary Schneider says the combined companies can deploy enhanced technology and analytics to improve services to consumers.