Oct 22, 2020 - Economy

McAfee raises $740 million in its IPO

Dan Primack

a computer with an eye mask over it — Illustration: Aïda Amer/Axios

McAfee, a San Jose, Calif.-based provider of antivirus and endpoint security software, raised $740 million in its IPO at an initial market value of $8.6 billion.

Why it matters: The company's IPO prospectus lists "brand recognition" as its top competitive strength, even though its eponymous founder was recently arrested on tax evasion and firearms charges. John McAfee, who also was a "person of interest" in a 2012 murder in Belize, is no longer involved with the company.

Details: McAfee priced at $20 per share, within its $19-$22 range, and will list on the Nasdaq (MCFE), used Morgan Stanley and Goldman Sachs as lead underwriters.

It reports $31 million of net income on $1.4 billion in revenue for the first half of 2020. Backers include TPG, Thoma Bravo, Intel, and GIC.

Context: This comes in the midst of boom times for cybersecurity stocks, with the Global X Cybersecurity ETF (Nasdaq: BUG) up 34% year to date.

The bottom line: "McAfee’s stock offering comes in the form of a complex 'Up-C' arrangement, which is common among private equity-backed companies and meant to provide tax benefits to insiders. Intel and private equity investors will retain about 82.2 per cent of the company’s voting power," the Financial Times writes.

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McAfee raises $740 million in its IPO

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