Intel’s McAfee Makes $389 Million Offer for Stonesoft

Andrew Klips |

Computer security software company McAfee Inc., a wholly owned subsidiary of Intel Corporation (INTC), said Monday that it has executed a definitive agreement to launch a conditional tender offer to acquire Stonesoft Oyj, a maker of next-generation network firewall products. Headquartered in Helsinki, Finland, Stonesoft trades on the Nasdaq OMX (NDAQ) Helsinki exchange under the ticker SFT1V. Stonesoft has more than 6,500 customers globally, comprised of governments, retailers and more.

The all-cash deal values Stonesoft at $389 million.

Stonesoft closed trading on Friday at 1.97 euros. The McAfee offer puts a value of 4.50 euros per share, representing a 128 percent premium.

"We plan to integrate Stonesoft's offerings with other McAfee products to realize the power of McAfee's Security Connected strategy,” said Michael DeCesare, president of McAfee. Stonesoft products will benefit from the collective expertise of more than 7,200 McAfee employees. Leveraging McAfee's cloud-based Global Threat Intelligence service will provide our combined customers with unparalleled security."

McAfee is best known for its antivirus services that compete with peers like Norton Antivirus, which is developed and distributed by Symantec Corp. (SYMC) and Russia-based Kaspersky Labs. However, the cornerstone of those companies’ core competencies, PC-based security, is fading as mobile devices and cloud-based technologies are becoming the norm. The new acquisition will help position McAfee as a leader in firewall protection at a time when high-profile hacks have run rampant, in part because of what Stonesoft has coined “Advanced Evasion Techniques,” or AETs. AETs use a combination of techniques to breach systems, often times undetectable to the network. Stonesoft was the first to identify this new type of hacker technology and is working to address vulnerabilities related to AETs.

On April 23, the markets were rattled by a fake tweet sent through a hack of Associated Press’ Twitter account reading, "BREAKING: Two Explosions in the White House and Barack Obama is injured." The tweet was sent to nearly two million AP followers and re-tweeted more than 1,000 times in the few minutes it was online before being removed.

Intel said in January that it intended to utilize an acquisitions and new partnerships strategy to “deliver more integrated solutions and comprehensive protection.” Buying Stonesoft is the next move in that plan which has already included acquiring ValidEdge from LynuxWorks in March to strengthen its malware detection offerings.

Shares of Intel closed Friday at $23.96, representing the highest level for the stock since September 5, 2012. Shares are ahead by more than 18 percent so far in 2013.

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Companies

Symbol Name Price Change % Volume
INTC Intel Corporation 37.75 0.43 1.15 24,279,306
NDAQ Nasdaq Inc. 67.54 0.06 0.09 906,090
SCHN Schnitzer Steel Industries Inc. 20.90 -0.02 -0.10 564,106
SYMC Symantec Corporation 25.10 0.09 0.36 10,888,079

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