After six months of fits and starts,
announced Friday thatit has successfully completed its offer to buy Internet spinoff
Santa Clara, Calif.-based Network Associates said in a press release that a total of 10.4 million shares were tendered by McAfee stockholders before theexpiration of its exchange offer at midnight (Eastern time) Thursday. That gave Network Associates, which previously owned 75% of McAfee shares, ownership ofabout 96% of outstanding McAfee stock.
Security software maker Network Associates said it expects to complete the merger with Sunnyvale, Calif.-based McAfee after the close of trading Friday.After Friday, McAfee.com will no longer be publicly traded and will cease to be a separate company.
Under the offer, McAfee shareholders will receive $8 in cash plus 0.675 of a share of Network Associates for each share of McAfee.
Network Associates had been trying since March to acquire the 25% of stock in McAfee, an antivirus software maker, that it didn't already own. The company,which still is under investigation by the
Securities and Exchange Commission
, withdrew its first offer in April after disclosing that it wouldhave to restate financial results.
After restating those results, Network Associates resumed its effort and increased the offer, only to be rebuffed by McAfee, which found its bid too low.Network Associates responded by recently raising its bid to the latest combination offering of cash and stock, and McAfee's board and advisers finally decided that the price was right.
Despite that sweetened price, Network Associates is still buying McAfee shares at a slight discount of 9 cents, or 0.5%, on the basis of Thursday's closing prices. The total deal is valued at about $202 million.
In recent trading, Network Associates was up 35 cents, or 2.7%, to $13.45, while McAfee was up 9 cents, or 0.5%, to $17.02.
The deal was conditional on the tender of sufficient McAfee shares sothat Network Associates would own at least 90% of outstanding shares by thedeadline. Network Associates reserved the right to waive or reduce that requirement but said it would not exchange McAfee shares if less than a majority of outstanding McAfee shares not owned by Network Associates were tendered.
In 1999, security software maker Network Associates spun off McAfee.com,which sells security software via the Internet on a subscription basisprimarily to consumers. Network Associates has said it wants to buy back the company to reduce brand confusion and expand into the consumer market, which is dominated by competitor
In a separate press release Friday, Network Associates named Wiliam Kerrigan senior vice president of a newly created McAfee consumer division. Kerrigan brings 24 years of sales and management experience to the position, including 19 years with IBM Global Services.