Antivirus and security software vendor Avast announced its bid to acquire its Czech-based competitor AVG at a purchase price of $25 per share in cash. That would work to a total of $1.3 billion cash, which Avast will be required to shell out to acquire AVG.
Avast is said will use its cash balances in addition to committed debt financing from third party lenders to purchased AVG. This acquisition is meant to give Avast a wider market and increase its geographical breadth. The security software vendor also announced its plans to build up more extensive security offerings, particularly within the growing market of Internet of Things.
Avast also intends to undertake some organization restructuring to achieve maximum efficiency. This move will possibly see a reduction in employees headcount under the company’s payroll. In a statement, Avast’s spokeswoman said.
“We haven’t started planning the team integration yet. Over the next months we will be analyzing and planning the organizations, but can’t speak of any potential staff reductions until after that.”
Nonetheless, the company did not shy away from boasting about the potential gain when Avast and AVG user-base are combined. The merging of the two security software vendors will see Avast have access to over 400 million endpoints, out of which 160 million will be mobile; meaning it will not just have more customers but a wider access to information on malware. All that information will go a long way towards the company building the next generations of security software better tweaked for personal security and privacy products.
Vince Steckler, CEO of Avast Software in a statement said, “We are in a rapidly changing industry, and this acquisition gives us the breadth and technological depth to be the security provider of choice for our current and future customers.”
Their counterpart, Gary Kovacs the CEO of AVG added, “We believe that joining forces with Avast, a private company with significant resources, fully supports our growth objectives and represents the best interest of our stockholders. Our new scale will allow us to accelerate investments in growing markets and continue to focus on providing comprehensive and simple-to-use solutions for consumers and businesses, alike.
As the definition of online security continues to shift from being device-centric to being concerned with devices, data, and people, we believe the combined company with the strengthened value proposition; will emerge as a leader in this growing market.”
Avast has also confirmed that the AVG brand will not disappear. Instead, the company will be using the combination of the two brands because of their respective strengths in different markets.
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