McAfee entered into a definitive agreement to sell its Enterprise business to a consortium led by Symphony Technology Group (STG) in an all-cash transaction for USD 4.0 billion. The transaction is expected to close by the end of 2021, subject to customary regulatory approvals and closing conditions.
Following the sale, McAfee will become a pure-play consumer cyber-security company. With the proceeds, the company plans to issue a USD 4.50 per share special and reduce debt by approximately USD 1 billion. Around USD 175 million will go to customary transaction expenses and other one-time charges related to the acquisition. The USD 2.75 billion of remaining proceeds will be distributed by Foundation Technology Worldwide, McAfee’s controlled subsidiary, on a pro rata basis to all holders, including McAfee.
McAfee will use its pro rata portion of such proceeds to pay USD 300 million in required corporate taxes and related payments in connection with the transaction, and the rest to pay the special dividend. McAfee also expects to pay approximately USD 300 million in additional one-time separation costs and stranded cost optimisation, a portion of which will be expenses paid by proceeds from the transaction.
Until closing, McAfee will continue to conduct and operate the Enterprise business, while McAfee, STG, and the Enterprise business’s leadership team will partner to plan for a successful transition for the business, its employees, and its customers.
At close, McAfee will retain its name and will continue its singular focus on delivering products to protect consumers. The Enterprise business will be re-branded, which is expected to occur in the coming months.
