August 11, 2021
It’s now official. NortonLifeLock and Avast are merging in a cash-and-stock mega deal valued at more than $8.6 billion.
The pairing of NortonLifeLock and Avast will create a leader in consumer security software. The combined company expands to more than 500 million users globally and $3.5 billion in revenue.
The NortonLifeLock-Avast merger should close in mid-2022.
The boards of NortonLifeLock and Avast believe the merger has compelling strategic and financial rationale. They also believe it represents an “attractive opportunity to create a new, industry-leading consumer cyber safety business, leveraging the established brands, technology and innovation of both groups to deliver substantial benefits to consumers, shareholders and other stakeholders.”
Last month, Avast confirmed its board of directors was in advanced discussions regarding the possible merger.
Keep up with the latest channel-impacting mergers and acquisitions in our M&A roundup.
Tony Massimini is senior industry analyst for information and network security at Frost & Sullivan. Last month, he told us NortonLifelock is about two-and-half times the size of Avast. Moreover, this will add revenue for NortonLifelock and expand its customer base.
‘Huge Step’ for Consumer Cyber Safety
Vincent Pilette is NortonLifeLock’s CEO.
NortonLifeLock’s Vincent Pilette
“This transaction is a huge step forward for consumer cyber safety and will ultimately enable us to achieve our vision to protect and empower people to live their digital lives safely,” he said. “With this combination, we can strengthen our cyber safety platform and make it available to more than 500 million users. We will also have the ability to further accelerate innovation to transform cyber safety.”
The merger will combine Avast’s strength in privacy and NortonLifeLock’s strength in identity. That will create a product portfolio beyond core security and toward adjacent trust-based solutions.
In addition, it strengthens geographic diversification and facilitates expansion into the small business segments. Moreover, it addresses the home office and very small business segments, and expands partnerships.
Marc Botham is vice president of worldwide channels and alliances for Avast Business. He tells us for now, nothing changes for Avast’s partners.
“Until the transaction closes, which we currently expect to occur in calendar year 2022, both NortonLifeLock and Avast will continue to operate as two separate companies,” he said. “Decisions on the post-close structure of the products and the road map will be made during the integration process (subject to compliance with antitrust requirements). That said, Avast and NortonLifeLock have highly complementary offerings and we are confident that together we will provide the most comprehensive suite of offerings.”
Both companies will benefit from cross-selling each other’s products, Botham said.
“Avast will benefit from cross-selling its privacy offering to NortonLifeLock’s customer base while NortonLifeLock will benefit from opportunities to sell to its identity products to Avast’s customer base,” he said “In addition, the combined company will have the ability to leverage the combined regional expertise of both businesses and flexibility to reinvest in product and marketing to target new growth segments and regions, OEM PC manufacturing channels and B2B2C partnerships. The combined company can increase R&D investments beyond what either company could do alone and generate capacity to reinvest in innovation across the existing cybersecurity platform as well as into adjacent trust-based services.”
On completion of the merger, the combined company will be dual-headquartered in Prague, Czech Republic, and Tempe, Arizona. Moreover, it will have a significant presence in the Czech Republic.
The combined company will trade on the Nasdaq.
Following the completion of the transaction, Pilette will remain NortonLifeLock‘s CEO. Ondřej Vlček, Avast’s CEO, will join NortonLifeLock as president and will join its board of directors. In addition, Pavel Baudiš, a co-founder and director of Avast, will join the NortonLifeLock board as an independent director.
Avast’s Ondře Vlček
“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,” Vlček said. “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.”
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