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Intel to acquire McAfee

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DQW Bureau
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href="https://www.dqweek.com/intel-launches-core-i-series-processors">Intel

Corporation has

entered into a definitive agreement to acquire McAfee Inc, through

the purchase of all of the company's common stock at $48 per share

in cash, for approximately $7.68 billion. 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.

The acquisition reflects

that security is now a fundamental component of online computing.

Today's security approach does not fully address the billions of

new Internet- style="background: transparent none repeat scroll 0% 0%; -moz-background-clip: border; -moz-background-origin: padding; -moz-background-inline-policy: continuous;">ready

devices

connecting mobile and wireless devices, TVs, cars, medical

devices and ATM machines as well as the accompanying surge in cyber

threats. Providing protection to a diverse online world requires a

fundamentally new approach involving software, hardware and services.

Inside Intel, the company

has elevated the priority of security to be on par with its strategic

focus areas in energy-efficient performance and Internet

connectivity.

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href="https://www.dqweek.com/brocade-and-mcafee-joins-for-channel-enablement-programs">McAfee,

which has enjoyed

a double-digit YoY growth and nearly 80 percent gross margins last

year, will become a wholly-owned subsidiary of Intel, reporting into

Intel's Software and Services Group. The group is managed by

Renée

James, Sr VP, Intel and GM of the group. “With the rapid expansion

of growth across a vast array of Internet-connected devices, more and

more elements of our lives have moved online,” said Paul Otellini,

President and CEO, Intel. “In the past, energy-efficient

performance and connectivity have defined computing requirements.

Looking forward, security will join those as a third pillar of what

people demand from all computing experiences,” stated Otellini.

“The addition of McAfee

products and technologies into the Intel computing portfolio brings

us incredibly talented people with a track record of delivering

security innovations, products and services that the industry and

consumers trust to make connecting to the Internet safer and more

secure,” Otellini added.

“Hardware-enhanced

security will lead to breakthroughs in effectively countering the

increasingly sophisticated threats of today and tomorrow,” said

James. “This acquisition is consistent with our software and

services strategy to deliver an outstanding computing experience in

the fast-growing business areas, especially around the move to

wireless mobility.” She further added, “McAfee is the next step

in this strategy, and the right security partner for us. Our current

work together has impressive prospects, and we look forward to

introducing a product from our strategic partnership next year.”

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“The cyber threat

landscape has changed dramatically over the past few years, with

millions of new threats appearing every month,” said Dave DeWalt,

President and CEO of McAfee. “We believe this acquisition will

result in our ability to deliver a safer, more secure and trusted

Internet-enabled device experience.”

McAfee, based in Santa

Clara, California, was founded in 1987 and is the world's largest

dedicated security technology company with approximately $2 billion

in revenue in 2009. With approximately 6,100 employees, McAfee's

products and technologies deliver secure solutions and services to

consumers, enterprises and governments around the world and include a

strong sales force that works with a variety of customers.

The company has a suite of

software-related security solutions, including end-point and

networking products and services that are focused on helping to

ensure Internet-connected devices and networks are protected from

malicious content, phony requests and unsecured transactions and

communications. Among others, products include McAfee Total

Protection, McAfee Antivirus, McAfee Internet Security, McAfee

Firewall, McAfee IPS as well as an expanding line of products

targeting mobile devices such as smartphones.

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Intel has made a series of

recent and successful software acquisitions to pursue a deliberate

strategy focused on leading companies in their industry delivering

software that takes advantage of silicon. These include gaming,

visual computing, embedded device and machine software and now

security.



Home to two of the most
innovative labs and research centers in the high-tech industry, Intel

and McAfee will also jointly explore future product concepts to

further strengthen security in the cloud network and myriad of

computers and devices people use in their everyday lives.

On a GAAP basis, Intel

expects the combination to be slightly dilutive to earnings in the

first year of operations and approximately flat in the second year.

On a non-GAAP basis, excluding a one-time write down of deferred

revenue when the transaction closes and amortization of acquired

intangibles, Intel expects the combination to be slightly accretive

in the first year and improve beyond that.

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