Advent, Permira near deal to buy McAfee for more than $10 Billion
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Security-software company McAfee Corp. is nearing a deal to sell itself to a group including private-equity firms Advent International Corp. and Permira for more than $10 billion, according to people familiar with the matter.
A deal, which would value the cybersecurity company at around $25 a share, could be announced by Monday, some of the people said, adding that the talks are ongoing and could still fall apart.
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Based in San Jose, Calif., McAfee makes software that protects users against computer viruses, malware and other online threats. The company’s products are used in 182 countries across more than 600 million devices, according to its website.
McAfee, which returned to the public markets in October 2020, is part-owned by private-equity firms TPG and Thoma Bravo LP and Singapore sovereign-wealth fund GIC Pte. Ltd. Intel Corp. bought McAfee in 2011 as part of a strategy to move the chip-making giant’s technology beyond computers. Intel sold a majority stake in 2017 to TPG, with Thoma Bravo investing then too. Intel still owns a small stake.
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McAfee’s shares had risen modestly since the IPO before jumping roughly 20% to close at $25.46 on Friday on news of the potential deal, which was earlier reported by Bloomberg.
John McAfee founded the business in the 1980s. He left the company in 1994 and later moved to Belize. Mr. McAfee made headlines in 2012 after he fled to Guatemala to avoid police seeking to question him in connection with the suspected murder of his neighbor. Mr. McAfee, who maintained his innocence, was eventually deported to the U.S., and Belize declined to request his extradition. He died in a Spanish jail in 2021 and at the time of his death planned to appeal an extradition order to the U.S. in connection with federal tax-evasion charges.
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Deal making has been booming, with companies striking $2.2 trillion worth of mergers in the U.S. so far this year, more than double the amount at this time in 2020, according to Dealogic. Much of the activity has come from private-equity firms, which have been putting record amounts of money to work, especially in the technology sector, which got a boost from increased demand during the pandemic. Software companies in particular have become magnets for buyout firms, with their steady and predictable cash flows.
| Ticker | Security | Last | Change | Change % |
|---|---|---|---|---|
| MCFE | MCAFEE CORP. | 25.46 | +4.25 | +20.04% |
| AVDWF | ADVENT AWI HOLDINGS INC | 0.7518 | -0.08 | -9.69% |
Security has been particularly hot as more people work remotely and several high-profile breaches affecting both consumers and businesses underscored its importance. Earlier this year, NortonLifeLock Inc. agreed to buy cybersecurity firm Avast PLC for more than $8 billion and Microsoft Corp. agreed to buy RiskIQ, a small company founded in 2009 that helps companies track their vulnerability to digital threats.
With $81 billion in assets under management, Advent has been investing in technology for more than three decades. It is based in Boston and has offices around the world.
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Permira, which has €44 billion, equivalent to $51 billion, in committed capital and a global presence, also has a record of technology deals. Its portfolio company Informatica Inc., a data-management-software producer, went public last month and now sports a $10 billion market capitalization.
Write to Cara Lombardo at [email protected], Miriam Gottfried at [email protected] and Dana Cimilluca at [email protected]
