Intel Looking To Sell McAfee Business

Chip giant ,strong>Intel Corporation INTC is weighing the sale of its antivirus software maker, formerly known as McAfee, which it bought for $7.7 billion almost six years ago, according to a report on Financial Times.

Citing people close to the discussions, Financial Times said Intel has been talking to bankers about the future of its cybersecurity unit in a deal that would be one of the largest in the sector.

The report said private equity buyers are increasingly interested in cybersecurity companies, anticipating strong cash flow as corporate customers become increasingly worried about protecting their business from cyber attacks.

The Financial Times added that a group of PE firms might club together to buy Intel Security if it is sold for the same price or higher than the $7.7 billion Intel originally paid for it.

Meanwhile, Intel, hit by a weak PC market, is in a restructuring mode as it announced plans this year to cut 12,000 jobs and shifting its focus on selling chips for cloud computing rather than PCs, which the Financial Times said still accounts for 60 percent of sales and 40 percent of profits.

Intel acquired McAfee in 2010 to club its cybersecurity functionality on to chips. Under this plan, device manufacturers would still have to decide to activate this option, the report noted.

But, almost six years later, Intel has not yet completed this plan. Financial Times highlighted David DeWalt, the chief executive who helped engineer the sale, left to lead another security firm FireEye Inc FEYE, and his replacement, Mike DeCesare, left in 2014 and now runs another security company called ForeScout.

In the meantime, Intel renamed the company as Intel Security, but maintained the McAfee brand for some of its products. Intel Security is led by Chris Young, a former Cisco Systems, Inc. CSCO senior vice-president.

At time of writing, Intel was down 2.88 percent at $30.64.