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McAfee to be acquired by investor group for over USD14bn

McAfee Corp (McAfee), a specialist in online protection, is to be acquired by an investor group led by Advent International Corporation (Advent) and Permira Advisers (Permira), Crosspoint Capital Partners (Crosspoint Capital), Canada Pension Plan Investment Board (CPP Investments), GIC Private Limited (GIC), and a wholly owned subsidiary of the Abu Dhabi Investment Authority (ADIA).

McAfee Corp (McAfee), a specialist in online protection, is to be acquired by an investor group led by Advent International Corporation (Advent) and Permira Advisers (Permira), Crosspoint Capital Partners (Crosspoint Capital), Canada Pension Plan Investment Board (CPP Investments), GIC Private Limited (GIC), and a wholly owned subsidiary of the Abu Dhabi Investment Authority (ADIA).

As part of the transaction, the Investor Group will acquire all outstanding shares of McAfee common stock for USD26.00 per share in an all-cash transaction valued at approximately USD12 billion on an equity value basis, and over USD14 billion on an enterprise value basis after giving effect to repayment of McAfee debt. 

The purchase price represents a premium of approximately 22.6 per cent over McAfee’s closing share price of USD21.21 on 4 November, 2021, the last trading day prior to media reports regarding a potential sale of McAfee.

Upon completion of the transaction, the Investor Group will take ownership of McAfee. As a privately held company, McAfee will continue building on its success and proven track record of growth as a pure-play consumer cybersecurity leader following the sale of McAfee’s Enterprise business, and the associated one-time dividend of USD4.50 per share, to private equity firm Symphony Technology Group for USD4.0 billion, which closed on 27 July, 2021.

“This transaction is a testament to McAfee’s market-leading online protection solutions, our talented employees, and outstanding customers and partners,” says McAfee President and Chief Executive Officer, Peter Leav. “We want to thank our employees for their continued hard work and commitment to McAfee. We are thrilled to be partnering with premier firms who truly understand the cybersecurity landscape and have a proven track record of success.”

In 2017, TPG partnered with Intel to carve out McAfee from Intel’s core operations to establish a pure-play cybersecurity company with access to significant capital, operational and technology resources. McAfee completed its initial public offering last year, with TPG and Intel remaining as shareholders in the company.
 
Jon Winkelried, Chief Executive Officer of TPG and Chair of the McAfee Board, says: “Today’s announcement signals continued growth and opportunity for McAfee.  Over the last four years, the company has expanded its product portfolio, enhanced its go-to-market strategy, and pursued strategic M&A, including the divestiture of its enterprise business. We’re proud that today McAfee is a leading consumer cybersecurity franchise, protecting the digital lives of 20 million subscribers across the globe.”
 
Tim Millikin, Partner at TPG and McAfee Board member, adds: “It’s been a privilege to have partnered with McAfee and its leadership team to help navigate the company’s transformation and growth over the last four years.  Our partnership with McAfee reflects TPG’s focus on investing in growth to build companies that are driving differentiated value in their markets.”

“McAfee is one of the most trusted brands in the essential business of consumer digital protection,” says Bryan Taylor, Head of Advent’s Technology Investment Team and a Managing Partner in Palo Alto. “As consumers face new and complex cyber risks, we see tremendous opportunity to build on McAfee’s differentiated technology platform to continue delivering innovative solutions that can protect all facets of the digital lives of people around the world. We look forward to working alongside our investment partners and the talented McAfee team to continue setting the bar for consumer digital protection.”

Brian Ruder, Co-Head of Technology at Permira, says: “The need for personalised, innovative, and intuitive online protection services has never been greater. McAfee boasts an enviable brand, extensive partner ecosystem, loyal customer base and a rigorous commitment to product development. With our extensive experience in scaling global consumer technology and cybersecurity businesses, we are excited to work closely with McAfee and our fellow investors to help position the company for even greater heights.”
 
Greg Clark, Managing Partner at Crosspoint Capital and former Chief Executive Officer of Symantec, adds: “The risks that consumers face from all aspects of their digital lives is immense, and these risks are unprecedented and rapidly increasing. Consumers buy from brands they trust, and with the globally recognised brand of McAfee, we see the long term opportunity to deliver products and services to address these risks in all aspects of their digital presence.”
 
Collectively, the Investor Group will provide McAfee with both financial and operational resources to further enhance its consumer offering and capture the rapid growth in consumer demand for digital protection services. McAfee’s strong brand awareness, diversified distribution model and customer-centric approach has made it a clear leader in the rapidly evolving consumer online protection space. The Investor Group will support McAfee as it continues to broaden its differentiated online protection solutions and drive long-term value through market expansion.

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