Roughly six years after announcing that it would acquire security firm McAfee, Intel Corporation said it would spin off its security division as an independent company under the name McAfee.
In an announcement Wednesday afternoon, the chipmaker said the spinoff would be made in partnership with investment firm TPG, which will own 51 percent of McAfee, leaving Intel with a 49 percent stake. The transaction values the business at approximately $4.2 billion, significantly less than the $7.68 billion Intel paid to acquire McAfee in a deal that closed in 2011.
Intel will receive $3.1 billion in cash and retain the 49 percent stake after completion of the transaction
The McAfee brand, created by anti-virus software pioneer John McAfee, suffered some damage after the founder was wanted in Belize for questioning over the murder of his neighbor in late 2012, sparking months of dramatic events and a wild goose chase across Central America.
In January 2014, Intel announced its plans to phase out the McAfee name as the security division of the company was branded "Intel Security".
While John McAfee has had nothing to do with the security firm for more than 16 years, Intel Security still offers many McAfee branded products under its Intel Security division.
While Intel and TPG could have used the spinoff as a chance to ditch the McAfee name altogether, it has chosen to stand by its brand despite the negative association and PR issues with its former founder.
Christopher Young, who currently leads Intel's security division, will be appointed CEO of the new company upon closing of the transaction.
“As a standalone company supported by these two partners, we will be in an even greater position of strength, committed to being the best provider the cybersecurity industry has ever seen,” Young said.
"We believe that McAfee will thrive as an independent company. With TPG's investment, along with continued support from Intel, McAfee will sharpen its focus and become even more agile in its response to today's rapidly evolving security sector," said Jim Coulter, co-founder and co-chief executive of TPG.
The deal is expected to close in the second quarter of 2017, subject to regulatory approvals and customary closing conditions, Intel said.
The announcement is the second large deal in the cybersecurity industry in recent months. In June, Security firms Symantec and Blue Coat Systems announced that Symantec would acquire Blue Coat for roughly $4.65 billion in cash.