According to reports, Intel Corp., the world’s largest semiconductor chip maker, will acquire security software maker McAfee, for 7.7 billion in an all cash deal. Intel will pay $48 a share in cash for each share of McAfee, a 60% premium to Wednesday’s closing price.
Intel said the deal “elevates focus on security on par with energy-efficient performance and connectivity” and particularly centers on bringing security to mobile wireless chips.
The deal has been approved by boards of directors at both companies, and must be approved by McAfee shareholders and government regulators for it to become final.
Intel said the deal will be slightly dilutive to earnings in the first year of operations, and flat in the second year. On an adjusted basis, excluding a one-time write-down on deferred revenue, once the deal closes and the amortization of acquired intangibles, Intel says the deal will slightly increase earnings in the first year and improve beyond that.
While I can’t say that I saw this one coming, I can’t say that I am surprised either. Intel already knows that they have the chip manufacturing game down, now they are looking for more ways to be value added. Intel was already moving in this direction with the implementation of its vPro technology, and now with the acquisition of McAfee, it will allow Intel to develop even more security into the chips themselves, which will make them even more appealing to enterprise customers.
The recent acquisition of 3Par by Dell and Fortify by HP, seem to indicate that businesses are starting to feel like the economy is recovering enough to start spending again, which should be good news all around.