Veritas's Future Is Scrutinized

News that Veritas Software Corp. (Nasdaq: VRTS) could become a $13 billion snack in the software food chain, after years of gobbling smaller companies, has surprised the storage industry.

According to a report in the New York Times this morning, Symantec Corp. (Nasdaq: SYMC) is on the verge of completing negotiations to purchase Veritas. The deal would create a software company with more than $4 billion in revenue (see Veritas to Be Sold, Paper Says)

Neither company has commented on the report, but it has sent ripples of speculation through the storage industry. Some say other suitors will be knocking on Veritass door to raise that $13 billion price tag.

Veritas has created lots of acquisition news in recent years -- as the buyer, not the seller. It paid $609 million for application performance management vendor Precise Software Solutions in June 2003 and $225 million for email archiver KVS last August. The company's also picked up a string of smaller companies along the way (see Veritas Picks Up Precise, No Brainer: Veritas Buys KVS, and Veritas Buys More Utility Power).

There had been speculation that Veritas might be a target for acquisition after its revenue fell in the second quarter of this year, but such talk quieted after the company bounced back last quarter (see Veritas Rides Earnings See-Saw and Veritas Rebounds).