| It's hard to put a value on the deal [1]. But - Using the rankings of CA's largest to smallest [2], the first public CA is GoDaddy (W2Techs 2016 Survey), which has a range of services. They show GoDaddy to be 11.8% of the market, with Symantec at 26%. So Symantec is 220% larger. I'm too lazy to estimate GoDaddy's CA business from their financials, I didn't see anything obvious in their financials to make it easier. GoDaddy's public valuation at this time is 7.27B [3], and if we scale up GoDaddy Market Cap to Symantec's size, and only account 20% [4] to the CA business: 7.27B * (26/11.8) * .2 = ~3.2B (Symantic CA Business) If we use DigiCert, and try to GoDaddy's market cap down to DigiCerts market share (3.0%) [2]. Then you end up with 7.27B * (3.0/11.8) * .2 = ~370M (DigiCert Current Valuation) However, DigiCert becomes number two CA provider overnight, to 29%, which rockets their value up (maybe?), by our same math, they are now 245% the size of GoDaddy from a cert perspective, 7.27B * ((26 + 3)/11.8) * .2 = ~3.57B (DigiCert + Symantec Business) [5]. So Symantec ends up with 950m cash and 1.07B DigiCert holdings (3.57B * .3 = 1.07B), or ~1.957B of value. That'd mean Symantec is taking 2/3rds (~1b hit) - that feels like a pretty solid deterrent? 1. Armchair economist
2. https://en.wikipedia.org/wiki/Certificate_authority
3. https://www.google.com/finance?q=NYSE%3AGDDY&ei=qU-CWciuPMqg... (8/2/2017 EOD MarketCap)
4. This could be wildly high..
5. Normally a combined entity would have duplicative operations and arguably be worth more than their whole, but since these are kind of iffy assets, they probably would be worth less. |