Chip giant Intel has revealed it will acquire security security mainstay McAfee in a epic deal valued at US$7.68 billion in cash.
In terms of the deal, in which Intel will buy all of McAfee’s common stock for $48 per share in cash with McAfee operating as a wholly-owned Intel subsidiary and report into Intel’s Software and Services Group.
Both boards of directors have unanimously approved the deal, which is expected to close after McAfee shareholder approval, regulatory clearances and other customary conditions specified in the agreement.
McAfee, which was established in 1987, has become one of the world’s largest security companies, covering a variety of market sectors including consumers, mid-market, enterprises and the public sector. Last year, McAfee boasted roughly $2 billion in annual revenues.
The McAfee buy comes as Intel looks to broaden its security presence. Calling security a “fundamental component of online computing,” Intel says that security as a whole currently lags and doesn’t address the billions of new Internet-ready devices such as mobile and wireless devices, TVs, cars, medical devices and ATM machines. Intel adds that protecting these devices from the ever-evolving landscape of threats requires a new approach to security that marries software, hardware and services. The McAfee buy, Intel says, will enable this approach.
According to Intel, the McAfee deal will help Intel create security software and hardware from a single company that better protects consumers, corporations and governments as billions of devices — as well as the cloud and server infrastructure that they run on — go online.
Over the past few years Intel has been bulking up its software offerings, acquiring various companies that leverage Intel’s silicon offerings such as Wind River, which makes embedded device software, and Havok, a maker of game development tools. McAfee plays perfectly into Intel’s software plans, the company says, which include making security a top priority as it spreads its wings in the embedded device space. Combined, Intel and McAfee will look to strengthen security in the burgeoning cloud computing and mobile device markets.