McAfee rattles tin for $600m+ in fresh IPO filing valuing firm at $3.6bn

That's if shares sell at the high end

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McAfee – the antivirus vendor, not the totally sane and level-headed man who founded it – is reportedly looking to raise more than $600m in its upcoming IPO.

The news comes some weeks after McAfee made a placeholder valuation of $100m in its IPO filing, with investment speculators reckoning the final sum might top $2bn.

The business will offer around 31 million shares to the market at $19-$22 apiece, according to the S-1. Just over 6 million shares will come from existing stockholders, who will pocket those dollars.

This deal would value McAfee at $3.64bn if shares sold for the full $22.

The filing stated: "We estimate that the net proceeds to us from this offering will be approximately $588m, or approximately $612m if the underwriters exercise in full their option to purchase additional shares of Class A common stock."

It added that a portion of the money would be used to pay down some of its debt and to buy class B stock.

McAfee’s US investment prospectus stated the firm’s wares “protected over 600 million devices as of June 27, 2020”. In the first six months of to 27 June 2020, McAfee claimed a net profit of $31m; last fiscal year (2019) it reported revenues of $2.6bn – and a net loss of $236m.

Those revenues are a rather shaky comparison to Intel Security’s quarterly income of $1.1bn at the time of its spin-out from Chipzilla proper, as we reported at the time. Looking back further in the history books McAfee was bought by Intel for $7.68bn in 2010, back in the sepia-toned days of its stock trading at $29.93.

Four years ago Intel sold its majority stake in McAfee to private equity firm TPG.

McAfee’s PC antivirus product has long enjoyed a less than stellar reputation among power users, not least thanks to the 2018 update shenanigans that caused it to crash computers running McAfee Endpoint Security. Later that same year a security company claimed that a priv-escalation CVE in McAfee’s True Key software had not been fully addressed despite two patches being issued by the company to fix it.

Perhaps the IPO will uncover some financial or technical McAfee wizardry that has hitherto been hidden over the past decade. ®

Bootnote

John McAfee, the founder of the firm who sold up and exited it in the 1990s, was arrested last week on charges of tax evasion and breaches of US securities laws. His colourful past is likely to feature heavily in the 74-year-old’s upcoming legal proceedings.

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