Intel announced a deal to sell a majority stake in its security business, formerly known as McAfee, to private equity firm TPG for approximately $3.1 billion.
Under the terms of the deal, TPG will take a 51 per cent stake in a newly formed cyber security unit it will co-own with Intel, which will retain 49 per cent.
The standalone business will revert to the original McAfee brand rather than its current Intel Security name.
TPG said it will also make an additional $1.1 billion investment “to help drive growth” and sharpen focus, giving the unit a total value of $4.2 billion. Intel bought the original McAfee business for $7.7 billion in 2011, with analysts worrying at the time that the chipmaker was overpaying for the security firm.
Intel wanted to diversify and embed McAfee’s security functionality on its chips, but such a strategy failed to materialise.
CEO Brian Krzanich said security “remains important in everything we do”, and it will continue to integrate security and privacy capabilities in its products.
“As we collaborate with TPG to establish McAfee as an independent company, we will also share in the future success of the business and in the market demand for top-flight security solutions, creating long-term value for McAfee’s customers, partners, employees and Intel’s shareholders,” he said.
Chris Young, SVP and general manager for Intel Security, will take over as CEO of the new McAfee when the deal closes, which is expected in Q2 2017, after receiving regulatory clearance.