McAfee Goes Private in $14 Billion Acquisition

The security software firm McAfee announced on Monday that it is going private once an acquisition deal with a group led by equity firm Advent International is finalized.

A final acquisition price tag of over $14 billion is expected, once the deal passes regulatory hurdles. As part of the deal, the private investor group will take control of all outstanding McAfee stock, at $26 per share. This is a premium for the stock, which traded for $21.21 at the end of the day on Nov. 4, 2021.

The recent acquisition, which was rumored late last week before being officially announced Monday, comes as McAfee announces strong gains in Q32021. In a press release highlighting the quarterly gains, Peter Leav, McAfee's president and CEO, pointed out the continued growth the company's consumer products have seen over the past few quarters:

McAfee delivered another strong quarter, with revenue growing 24% year-over-year. Our continued commitment to secure our customers' online footprint helped us add 640 thousand net new direct-to-consumer subscribers, a year-over-year increase of 16% in Q3. We continue to invest in our online protection services and diversified go-to-market channel, as consumers increasingly adopt digital services.

The deal, which was approved by the McAfee Board of Directors, is expected to close in the first half of 2022. That takes into account a 45-day "go shop" period in which competing offers can be submitted. Once this phase has ended and regulatory approvals have been reached, current stockholders will be paid out at the negotiated $26-per-share price.

The private investor group led by Advent International said its run for McAfee was a solid move in a world where cybersecurity incidents are on the rise and new challenges facing consumers and IT stemming from the expansion of remote work are emerging.

"As consumers face new and complex cyber risks, we see tremendous opportunity to build on McAfee's differentiated technology platform to continue delivering innovative solutions that can protect all facets of the digital lives of people around the world," said Bryan Taylor, head of Advent's Technology Investment Team and a managing partner. "We look forward to working alongside our investment partners and the talented McAfee team to continue setting the bar for consumer digital protection."

This is just the latest chapter in the storied security firm's history. McAfee, which was founded by the recently deceased John McAfee in 1987, became a leader in the cybersecurity space due to its leading anti-virus software. Long after McAfee left the company, Intel took ownership in 2004 and slowly phased out the McAfee brand in favor of its Intel Security brand over the next 10 years.

Then in 2014, Intel sold its majority stake of McAfee to TGP. The McAfee brand was spun back out of Intel and the company once again became publicly traded in October 2020.

About the Author

Chris Paoli (@ChrisPaoli5) is the associate editor for Converge360.


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