NortonLifeLock to buy out LSE-listed Avast for $8.6bn
Deal will create 'industry leading' cybersecurity business, Avast claims
NortonLifeLock has revealed plans to acquire Avast for as much as $8.6bn, in a deal which it claims will create an "industry leading" consumer cybersecurity business.
The transaction, made up of a combination of cash and new shares, will value LSE-listed Avast at between $8.1bn and $8.6bn.
Avast shareholders will receive $7.61 in cash and 0.0302 of a New NortonLifeLock Share for each Avast share held.
The deal represents a 20.7 per cent premium on Avast's closing price of 504.2 pence per share as of 14 July 2021 - the last business day
Once the acquisition closes, the combined business will be listed the Nasdaq exchange and be headquartered in both Tempe, Arizona and Prague in Czech Republic.
Avast's chief executive Ondrej Vlcek will join NortonLifeLock's board and will be appointed president of the combined business while NortonLifeLock CEO Vincent Pilette will become chief executive of the combined business.
Avast's share price jumped by more than five per cent as markets reacted to the news this morning.
NortonLifeLock came into being following Broadcom's acquisition of Symantec's enterprise business in 2019, leaving behind its consumer operations as a standalone business.
Meanwhile, Avast acquired cybersecurity peer AVG in 2016 which created a behemoth with more than 400 million users globally.
In a statement, Pilette said that the merger will create a business with "compelling strategic scale" with a user base of more than half a billion.
"Our proposed merger with NortonLifeLock is a major step forward… creating a world-leading consumer Cyber Safety business which combines Avast's strength in privacy and NortonLifeLock's strength in identity protection. United, our highly complementary product portfolios will have far-reaching benefits, significantly enhancing our ability to drive innovation through R&D, and accelerating the transformation of our Cyber Safety platform for our more than half a billion combined users.
"At a time when global cyber threats are growing, yet cyber safety penetration remains very low, together with NortonLifeLock, we will be able to accelerate our shared vision of providing holistic cyber protection for consumers around the globe. Our talented teams will have better opportunities to innovate and develop enhanced solutions and services, with improved capabilities from access to superior data insights. Through our well-established brands, greater geographic diversification and access to a larger global user base, the combined businesses will be poised to access the significant growth opportunity that exists worldwide."
Rumours of merger talks between the pair were reported by The Wall Street Journal last month, claiming that the combined group would have a market valuation of $16bn.