{"id":116402,"date":"2021-03-09T11:39:22","date_gmt":"2021-03-09T16:39:22","guid":{"rendered":"http:\/\/rbach.net\/?p=116402"},"modified":"2021-06-27T21:18:02","modified_gmt":"2021-06-28T01:18:02","slug":"mcafee-selling-its-enterprise-security-business","status":"publish","type":"post","link":"https:\/\/rbach.net\/index.php\/mcafee-selling-its-enterprise-security-business\/","title":{"rendered":"McAfee Selling its Enterprise Security Business"},"content":{"rendered":"\r\n

\"McAfeeMcAfee<\/a><\/strong> is back in the news again. The often sold antivirus vendor is selling its enterprise security business. McAfee and private equity firm Symphony Technology Group<\/a><\/strong> (STG) announced on 03\/08\/2021 that the PE is buying McAfee’s enterprise security business for $4.0 billion<\/strong> in an all-cash deal. The deal is expected to close before 2022. McAfee is keeping its consumer security software business.<\/p>\r\n

Selling its enterprise security business<\/h3>\r\n

\"$4.0<\/a>The McAfee website touts that the enterprise business serves 86% of the Fortune 100 firms, and generated $1.3 billion in net revenue in the fiscal year 2020. Despite these numbers, it is clear why McAfee is selling its enterprise security business. For FY2020 the company reported $2.9 billion in total revenue, up 10% YoY. Techcrunch<\/a><\/em> says<\/a> the overall revenue broke down to $1.6 billion from the consumer side. The enterprise side brought in $1.3 billion in net revenue, an increase of just 1%<\/strong>.<\/p>\r\n

Increased competition<\/h3>\r\n

One of the reasons McAfee is selling its enterprise security business is increased competition<\/strong>. McAfee\u2019s enterprise business has struggled in recent years against fast-growing endpoint detection and response (EDR) software companies \u2014 such as CrowdStrike and SentinelOne<\/strong>. CrowdStrike\u2019s<\/a> revenue was up 86% YoY in 21Q3. SentinelOne<\/a> is preparing an IPO<\/a> that could achieve a $10 billion valuation. Also, major technology companies such as Cisco Systems<\/a>, Microsoft<\/a>, and VMware’s\u00a0 Carbon Black<\/a> have pushed deeper into McAfee’s market space.<\/p>\r\n

We have seen this before<\/h3>\r\n

\"We<\/a>After the sale of the enterprise security business, it will re-branded<\/strong>. Once the deal closes, the McAfee consumer business will be known as McAfee. The STG-McAfee deal is similar to Symantec\u2019s breakup<\/a>. As I wrote about in 2019, Broadcom acquired Symantec\u2019s enterprise security business for $10.7 billion. Symantec\u2019s consumer business, now known as NortonLifeLock, remains publicly traded.<\/p>\r\n

Legacy Synergy\u00a0<\/span><\/p>\r\n

\"Synergy\"<\/a>STG’s purchase of McAfee’s enterprise security business should pair well<\/strong> with another STG enterprise-focused security holding. The PE firm purchased<\/strong><\/a> RSA from Dell<\/strong> last February for $2 billion.\u00a0STG did not point directly to the RSA acquisition, the two investments create a large combined legacy security business<\/strong> for the firm. Both firms have strong brand recognition but have lost some of their edge to more modern competitors in the marketplace.<\/p>\r\n

Stay safe out there !<\/a><\/strong><\/em><\/p>\r\n

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