The all-cash transaction is expected to close by the end of 2021. "There are a number of buyers that would love the chance to get their hands on some of McAfee's more desirable assets, such as the MVISION Cloud (formerly Skyhigh) technology, as well as its still-lucrative IPS business," he said. "I expect consumer-focused McAfee will either be acquired and merged with another consumer security vendor, or simply go out of business in 2-3 years," he said.Īs for McAfee's enterprise business under STG, Parizo said it's possible that McAfee could be merged with RSA into a new entity, but the more likely outcome is STG will break up the business even further. Parizo said McAfee's prospects as a consumer cybersecurity vendor aren't bright, especially since the company will be going up against the larger Norton LifeLock, with fewer assets. Some might say that $4 billion undervalues McAfee, but frankly I think if they didn't take that deal now, the number was only going to go down, and Leav knew it." "There were numerous reported rounds of layoffs and closings of international offices it had held for years the hastily arranged IPO last fall, when it was highly debatable whether the company was ready, but clearly was looking to take advantage of favorable market conditions and key executive departures, including highly regarded chief product officer, Ash Kulkarni, at the end of last year. Once Leav came on board, his moves clearly showed the objective was to orchestrate the fastest and most lucrative exit possible for TPG and Thoma Bravo," Parizo said in an email to SearchSecurity. "I wrote at the time of Leav's appointment that it was only the first move in an effort that was likely to transition McAfee into a new phase, and that proved correct.
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Leav said the agreement will allow McAfee to become a leader in "personal security for consumers." The sale echoes a similar move from another legacy security vendor in Symantec, which in 2019 sold its enterprise business to Broadcom for $10.7 billion and refocused on its consumer security business.Įric Parizo, senior analyst at Omdia (formerly Ovum), said the deal with STG is not a surprise since there were many indicators that McAfee's stakeholders, including TPG, Thoma Bravo and Intel, had been eyeing a full or partial sale of the company. Since that time, McAfee expanded beyond its core antivirus business and invested heavily in cloud security, specifically its acquisition of cloud access security broker Skyhigh Networks in 2017 and the addition of the Mvision product suite. Intel received $3.1 billion in the transaction while private equity firm TPG Capital took a 51% stake in the company Intel and private equity firm Thoma Bravo held the remaining 49%. However, in 2016 Intel spun off the business, which was renamed McAfee and valued at approximately $4.2 billion.
Intel had hoped to make cybersecurity a core part of its business, combining McAfee's technology with its hardware products. In 2010, Intel purchased McAfee for $7.7 billion and renamed the company Intel Security Group. The company, which was founded in 1987, became one of the largest, most well-known security vendors in the industry, thanks to its consumer and enterprise antivirus products. The sale of the enterprise business to STG marks yet another tumultuous turn for McAfee. There was speculation among industry analysts that Leav's appointment signaled that McAfee could be acquired by a rival vendor or private equity firm.
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A longtime technology industry veteran, Leav had a track record of taking over companies like BMC Software and Polycom prior to their sales. Leav was named head of McAfee in January 2020 after the vendor pushed out former CEO Chris Young. "This transaction will allow McAfee to singularly focus on our consumer business and to accelerate our strategy to be a leader in personal security for consumers."
"STG is the right partner to continue strengthening our enterprise business, and this outcome is a testament to the business' industry-leading solutions and most notably to the outstanding contributions of our employees," said McAfee president and CEO Peter Leav in the announcement. The private equity firm recently acquired another brand name legacy vendor in RSA Security last year. The addition of McAfee's enterprise business strengthens Symphony Technology Group's (STG) security portfolio.
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