Avast to Acquire Antivirus Software Rival AVG for $1.3B
The all-cash deal is expected to create one of the largest antivirus companies by market share in the world.
Prague-based Avast says it will pay $25 per share in cash for Amsterdam-based AVG, 33% above Wednesday's closing price on the New York Stock Exchange after the two signed a deal on it.
PRAGUE, Czech Republic – Antivirus firm Avast Software, based here, said it has agreed to buy its rival AVG Technologies (NYSE: AVG) for $1.3 billion in cash.
Privately-held Avast, which is backed by global private equity firms CVC Capital Partners and Summit Partners, will begin a tender offer for Amsterdam-based AVG at $25 a share in cash, the companies announced in a statement Thursday. The offer price represents a 33% premium over the July 6 closing price, and a premium of 32% over the average volume weighted price per share over the past six months, according to the statement.
Avast will finance the deal with existing cash reserves and debt financing from third-party lenders.
The transaction will increase Avast’s opportunities in Internet security-related business, providing it with more scale and an increased geographical reach in both its core business and newer areas such as the Internet of Things (IoT), according to the statement.
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“We are in a rapidly changing industry, and this acquisition gives us the breadth and technological depth to be the security provider of choice for our current and future customers,” says Vince Steckler, CEO of Avast Software. “Combining the strengths of two great tech companies, both founded in the Czech Republic and with a common culture and mission, will put us in a great position to take advantage of the new opportunities ahead, such as security for the enormous growth in IoT.”
Combining users from both companies will create a network of more than 400 million endpoints, of which 160 million are mobile, that act as de facto sensors to help detect and neutralize new threats as soon as they appear, Avast said.
The acquisition has been unanimously approved by the management board and supervisory board of Avast. The management board and supervisory board of AVG approved the transaction and have recommended the offer for acceptance to shareholders. The transaction is expected to close sometime between September and October.
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About the Author
Rodney Bosch, Senior Editor
Although Bosch’s name is quite familiar to those in the security industry, his previous experience has been in daily newspaper journalism. Prior to joining SECURITY SALES & INTEGRATION in 2006, he spent 15 years with the Los Angeles Times, where he performed a wide assortment of editorial responsibilities, including feature and metro department assignments as well as content producing for latimes.com. Bosch is a graduate of California State University, Fresno with a degree in Mass Communication & Journalism. In 2007, he successfully completed the National Burglar and Fire Alarm Association’s National Training School coursework to become a Certified Level I Alarm Technician.
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