Wednesday 11 August 2021 7:18 am

NortonLifeLock to buy UK cyber firm Avast in $8bn deal

US cyber firm NortonLifeLock has confirmed it will buy British rival Avast in a deal that values the London-listed company at up to $8.6bn (£6.2bn).

In a statement yesterday the two companies said Avast shareholders will receive a combination of cash and newly-issued shares in Norton, with alternative options available.

Based on the US firm’s closing share price of $27.20 on 13 July, the deal will value Avast at between $8.1bn and $8.6bn.

The firms said the combined business would serve more than 500m cybersecurity customers, including around 40m direct customers.

“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,” said Vincent Pilette, chief executive of NortonLifeLock. 

“With this combination, we can strengthen our Cyber Safety platform and make it available to more than 500m users. We will also have the ability to further accelerate innovation to transform Cyber Safety.”

The companies said the merger would drive double-digital earnings per share growth within the first full year and double-digit revenue growth.

Following the deal Avast chief executive Ondrej Vlcek is set to join Norton as president and become a member of the board. 

Pavel Baudis, a co-founder and current director of Avast, will also join Norton’s board as an independent director.

The merged company will be dual-headquartered in Prague and Tempe, Arizona, with a “significant presence” in the Czech Republic. It will be listed on the Nasdaq.

The news comes as Avast today announced promising half year results. Adjusted EBIDTA reached $270.2m up 11.9 per cent in the first half of 2021 compared to the same period last year. Operating profits jumped 68.5 per cent to $226.7 while earnings per share increased by 20.5 per cent in the same period.

“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,” said Avast boss Vlcek.

“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.”

Read more: Shares in Avast jump as cyber firm confirms NortonLifeLock merger talks