Symantec said Thursday it agreed to buy rival utility software vendor Quarterdeck for about US$65 million in stock, in a move to acquire more antivirus and uninstaller software customers.
Symantec also said its second-quarter profit from operations almost shrank by half, but were still a penny ahead of Wall Street forecasts.
After the markets closed, Symantec (SYMC) said it signed an agreement to acquire Quarterdeck for 52 cents a share and assume Quarterdeck's (QDEK) debt. The boards of directors of both companies have approved the transaction. Symantec -– maker of programs like the Norton Utilities and PC Anywhere -- expects the tender offer to be completed by the end of November 1998, the company said in a statement.
"We expect to further increase our technical leadership in desktop and enterprise utilities by integrating Quarterdeck's technology with ours, and continuing to deliver superior products to customers under the Norton brand," Symantec CEO Gordon Eubanks said in a statement.
Quarterdeck, a powerhouse software company of the 1980s, had fallen on hard times in recent years amid heavy competition for antivirus and utility software sales. In addition to Symantec, Quarterdeck had to compete against Network Associates, another huge utilities vendor that has been mopping up weaker companies.
Quarterdeck's revenue for the 12 months ended June 1998 was about $57 million. But Quarterdeck reported a third quarter net loss of $14.7 million, or $0.27 per share on revenues of $8.03 million.
Separately, Symantec, based in Cupertino, California, reported results for its latest quarter. Before one time charges, the company saw net income of $11 million, or about 19 cents per diluted share, on revenues of $140 million. In the same quarter last year, it had net income of $20.58 million, or 35 cents a diluted share, on revenues of $139 million. With a $6.1 million charge to cover the cost of a recent restructuring, Symantec had net income of $6.8 million, or 12 cents a share.
For the latest quarter, analysts had expected profit from operations of 18 cents a share, according to research firm First Call.
The company blamed slow retail sales in the summer for the earnings decline.
The announcements came after the market closed. Symantec shares rose 37 cents to close at $9.06. Shares of Quarterdeck closed down 3 cents at 43 cents.
