McAfee.com Committee Approves Network Associates' Latest Bid

McAfee.com Network Associates

The committee of McAfee.com's board said it determined that Network Associates' offer to acquire each outstanding share of McAfee.com's Class A common stock in exchange for $8 plus 0.675 of a share of Network Associates common stock is fair.

On Aug. 13, Network Associates sweetened its bid after McAfee.com, based here, rejected a previous offer of 0.9 of a share.

Network Associates, Santa Clara, Calif., already owns about 75 percent of McAfee.com, a provider of online antivirus services that it spun out as a publicly traded company in December 1999.

By merging McAfee.com back into the corporate fold, Network Associates executives said they hoped to eliminate market confusion and streamline sales efforts.

Network Associates originally offered to acquire the remaining shares of McAfee.com in March but delayed the bid after disclosing that the SEC was investigating its fiscal 2000 accounting practices. It quickly renewed the bid but delayed it again after finding inaccuracies in its 1999 and 2000 financial reports.

In July, the company again renewed its bid after filing restated financial statements but the McAfee.com board rejected it as inadequate.

The current offer, which the McAfee.com committee accepted, represents a value of $17.86 per share based on the closing price of Network Associates stock as of Aug. 21. That represents an 81 percent increase over Network Associates' original offer in March of $9.86 per share, also based on the closing price of Network Associates stock on Aug. 21.

"The special committee is pleased that Network Associates has presented an offer we are able to recommend to our stockholders," special committee member Frank Gill said in a prepared statement.

"McAfee.com's stockholders can now receive what we believe is a fair value for their holdings and benefit from the strategic advantages of the recombined companies," he said.