Intel sells off majority stake in McAfee unit

Intel made the deal with investment firm TPG, which will own a 51 percent stake

Intel is selling off a majority stake in its McAfee unit and turning it back into an independent security company.

Intel made the deal with investment firm TPG, which will own a 51 percent stake in the new McAfee company. Intel will own the remainder.

As part of the deal, Intel is receiving $3.1 billion in cash. It originally bought McAfee back in 2011 for $7.7 billion -- a deal that caused some industry watchers to scratch their heads.

Intel is best known as a chipmaker, but at the time it was also hoping to improve  security around its products. PC security was a major concern back then, said Nathan Brookwood, principal analyst at Insight 64. But now cyberthreats are moving to target the cloud and servers.

"McAfee had relatively little to do in cloud security. While Intel didn't lose a lot of money, it never was a huge win," he said.

In 2014, the chipmaker rebranded its McAfee business as Intel Security. However, reports about a possible McAfee sale circulated earlier this year as Intel worked to restructure its business amid lagging PC sales. In April, the company announced it would cut 12,000 jobs.  

On Wednesday, Intel said the new McAfee will be one of the largest “pure-play” cybersecurity companies in the world. The new company will be valued at $4.2 billion.

In addition, TPG is making a $1.1 billion equity investment in its new McAfee property to drive growth.

Intel will continue partnering with the McAfee unit on security. Chris Young, the general manager for Intel Security, will be head of the new company.

In a letter to stakeholders, Young said the company is still committed to delivering on its product roadmap, but that it can execute its plans even faster. 

"Our customers want the reassurance that our strategy has not changed. It hasn’t," he added. 

The deal is expected to close in next year’s second quarter.

Agam Shah contributed to this report. 

Join the newsletter!

Or

Sign up to gain exclusive access to email subscriptions, event invitations, competitions, giveaways, and much more.

Membership is free, and your security and privacy remain protected. View our privacy policy before signing up.

Error: Please check your email address.
Keep up with the latest tech news, reviews and previews by subscribing to the Good Gear Guide newsletter.

Michael Kan

IDG News Service
Show Comments

Brand Post

Most Popular Reviews

Latest Articles

Resources

PCW Evaluation Team

Emily Tyson

MSI GE63 Raider

If you’re looking to invest in your next work horse laptop for work or home use, you can’t go wrong with the MSI GE63.

Laura Johnston

MSI GS65 Stealth Thin

If you can afford the price tag, it is well worth the money. It out performs any other laptop I have tried for gaming, and the transportable design and incredible display also make it ideal for work.

Andrew Teoh

Brother MFC-L9570CDW Multifunction Printer

Touch screen visibility and operation was great and easy to navigate. Each menu and sub-menu was in an understandable order and category

Louise Coady

Brother MFC-L9570CDW Multifunction Printer

The printer was convenient, produced clear and vibrant images and was very easy to use

Edwina Hargreaves

WD My Cloud Home

I would recommend this device for families and small businesses who want one safe place to store all their important digital content and a way to easily share it with friends, family, business partners, or customers.

Walid Mikhael

Brother QL-820NWB Professional Label Printer

It’s easy to set up, it’s compact and quiet when printing and to top if off, the print quality is excellent. This is hands down the best printer I’ve used for printing labels.

Featured Content

Product Launch Showcase

Latest Jobs

Don’t have an account? Sign up here

Don't have an account? Sign up now

Forgot password?