Relational, an investor that made sure it would have a place in the board of Genzyme Corp., a drug manufacturer, has slowly but surely been making its way into the software company Symantec Corp., by buying its shares. Analysts familiar with the strategy employed by Relational are expecting this move by the company to have pronounced effects on the software firm, possibly even its break-up. A source claimed that among the alterations that Relational may consider doing would be to make Symantec split into two companies based on its two core businesses, storage and capacity. Among the plans that Relational may be cooking up would be to spin off the Veritas storage division of Symantec. This would make the company open to more buyers who would otherwise be too shy to acquire such a huge company as the current Symantec. The Veritas storage division would be something more buyers would be attracted to, since it would be smaller, not to mention more affordable. Spokespersons for Symantec and Relational have both refused to comment.
Who is Relational?
Relational is an activist investment fund based in San Diego. The firm, which has Ralph Whitworth as one of its co-founders, started accumulating Symantec stocks over the summer. As of June 30, according to a Relational report, its ownership of Symantec is already at 5.7 million shares, or 0.72 percent of the entire company. Sources in the industry said that the new activist shareholders are taking a bigger stake in Symantec. Other sources have claimed that a number of activist investors have been approached by bankers that pitch ideas to them, including letting them confront the company’s management head on.
New names in the stockholder list?
It is expected that by November 15, when Symantec shareholders will be reporting their holdings, the names in the list of shareholders owning between 1 to 5 percent of the company will see some new “surprises.” Included in these names are Jana Partners and Carl Icahn, a billionaire activist shareholder. Both parties have had previous shares in Symantec. Relational, for its part, has had a history of buying companies so that it can implement some changes it would like for those companies.
HP and Cisco, companies that had wanted to buy Symantec in the past, have not released any comment.