McAfee.com Tuesday said its board of directors is recommending the company's stockholders reject Network Associates' increased buyout bid.
After a review with independent financial and legal advisers and on the recommendation of a special committee, the board decided Network Associates' offer "is inadequate and not in the best interest of McAfee.com's stockholders," the company said in a statement.
Late Monday, Network Associates sweetened its bid, offering McAfee.com stockholders 0.90 of a share of Network Associates common stock in exchange for each outstanding share of McAfee.com Class A common stock, a 15.5 percent increase from its original offer.
Network Associates, Santa Clara, Calif., already owns about 75 percent of McAfee.com, which it spun out as a publicly traded company in December 1999. McAfee.com, based here, provides online antivirus services and targets mostly consumers while McAfee Security, a division of Network Associates, targets the business market.
Network Associates originally offered to acquire the remaining shares of McAfee.com in March but delayed the bid after disclosing that the Securities and Exchange Commission 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.
Earlier this month, the company again renewed its bid after filing restated financial statements.