Intel Security is soon to be no more. The world's largest chip manufacturer has shed the majority part of its security arm, which it acquired in 2010 after purchasing McAfee, to private equity firm TPG Capital, for $US4.2 billion.
The deal turns the subsidiary into a stand-alone cyber security vendor, which will revive the McAfee brand once the deal is finalised. It values Intel Security at $US4.2 billion, which is based on the entity's $US2.2 billion equity value and its $US2 billion in debt.
Intel will retain a 49 per cent stake in the company and receive $US3.1 billion in cash. TPG Capital will take the remaining 51 per cent and will make a US$1.1 billion equity investment in the new company.
Intel bought McAfee in 2010 for $US7.68 billion, with the intent of tying McAfee's security technology with Intel's chips.
The vendor has since incorporated technology in some chips that power features of its security software. Its offerings also include network security gear and management, database, Web and server security, and encryption products.
In an open letter to stakeholders, Intel Security senior vice-president and general manager, Christopher Young, who will lead the new company once the deal is done, said the company will benefit from a sole focus on cyber security for endpoints and the cloud.
"We will continue to focus on solving the unique demands of customers in the dynamic cybersecurity marketplace, drive innovation that anticipates future market needs, and continue to grow through our strategic priorities," Young said.
"For our partners, you will be able to confidently represent one of the most comprehensive, leading portfolios in the industry.
"As a pure-play provider, McAfee will accelerate the rate of innovation in delivering an integrated portfolio that is increasingly automated and orchestrated. And, with the investment by Intel, you will continue to benefit from Intel's technology leadership.
"Rest assured that McAfee will continue to stand behind you, alongside our joint customers, in delivering solutions across the entirety of the threat defence lifecycle," Young added.
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