Cyber security giant McAfee goes private in a $14bn deal

Cyber security company McAfee goes private in a $14bn (£10bn) deal with a consortium led by U.S. private equity firm Advent International.

The deal comes as a pandemic shift to working from home and a rise in cyber attacks have increased demand for digital security software.

The company, founded by technology entrepreneur John McAfee in 1987, was the first to bring a commercial antivirus to market.

It was acquired by Intel in 2011 for $7.6bn, and bought by the Texas Pacific Group (TPG) for $4.2bn. This makes the multi-billion dollar deal a mighty success for investment company, TPG.

In the last few years, McAfee has strengthened its main cybersecurity software business that focuses on retail customers via price increases, new partner programs and good retention rates.

As part of the transaction, the investor group will acquire all outstanding shares of McAfee common stock for $26 per share in an all-cash deal that values McAfee at about $12bn on an equity basis.

The purchase price represents a premium of 22.6 per cent over McAfee’s closing share price of $21.21 on November 4th, the last trading day before the Wall Street Journal reported about the deal talks.

Shares of the California-based company, which made its market debut last year, were down more than 3 per cent at $25.36 in premarket trading, slightly below the offer price.

The Advent-led consortium includes private equity firms Permira Advisers, Crosspoint Capital Partners and Canada Pension Plan Investment Board among others.

Although McAfee left the company in the mid-1990s, he made headlines last year when he was indicted on charges for U.S. tax evasion and was detained in Spain for market manipulation. He was found dead in his prison cell in June this year.