The Wall Street Journal quoted unidentified sources who are said to be close to the deal as saying it would give Symantec control of VeriSign's $410 million authentication business, which provides a range of encryption technologies and services.
Meanwhile, other news reports fuled the speculation by adding that VeriSign CFO Brian Robins had abruptly pulled out of a JP Morgan investors conference on Tuesday afternoon.
News of the possible deal pushed VeriSign's shares up by $1.39 or 5.18 percent to $28.23 Tuesday afternoon. But with the expected deal not announced until late Tuesday, VeriSign's shares yielded back some of that gain in after hours trading. Shares of Symantec meanwhile were down 2.03 percent to $15.95 on news of the rumored deal.
A spokesman for Symantec said the company would not comment on rumors and speculations. A VeriSign spokeswoman said also the company would not comment.
If the deal was to happen, it would be the second security related business unit that VeriSign has shed in the past few months. Last October the company sold its Global Security Consulting unit to AT&T in a deal, the terms of which were not disclosed.
The deal gave AT&T control of a VeriSign business unit focused on security and ID management related consulting services for Fortune 500 companies.
At that time, VeriSign CEO Mark Mclaughlin was quoted as saying that the sale was in keeping with VeriSign's goals to divest itself of certain business units.
Jaikumar Vijayan covers data security and privacy issues, financial services security and e-voting for Computerworld . Follow Jaikumar on Twitter at @jaivijayan or subscribe to Jaikumar's RSS feed . His e-mail address is firstname.lastname@example.org .
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This story, "Symantec to buy VeriSign's security unit for $1.3B, reports say" was originally published by Computerworld.