Network Associates Ups Its Offer for McAfee.com

Undeterred by continued rejection, NAI tries again to acquire remaining shares of the antivirus vendor.

Security software developer Network Associates on Tuesday made a revised offer to McAfee.com for the 25 percent of the company it doesn't already own, after having its last bid to take over the company rejected last month.

NAI, based in Santa Clara, California, increased the value of its offer for each outstanding share of McAfee.com common stock to $15.43 (based on the closing price of NAI common stock on August 12). The new deal now offers 0.675 of a share of NAI common stock plus $8 in cash for each outstanding share of McAfee.com common stock, NAI says in a statement.

NAI has also extended the expiration date of the offer until midnight, Eastern Time, on September 12, unless further extended, it says.

NAI had previously offered to exchange .90 of an NAI share for each outstanding share of McAfee.com. That offer was soundly rejected when only 4 percent of eligible McAfee.com's shares were tendered into the offer by the July 31 deadline.

NAI must either receive a majority of votes or increase its McAfee.com stake from 75 percent to 90 percent in order to make a deal between the two companies legally binding.

Renewed Efforts

McAfee.com's directors had urged shareholders to reject the overture by NAI, claiming that NAI's bid for the Sunnyvale, California, McAfee.com "significantly undervalued" the company. Refusing to be deterred by the rebuff, NAI immediately extended the deadline for its offer to August 13.

NAI has repeatedly attempted to reabsorb the subscription services and hosted applications provider, which it spun out as a separate company in 1999, in an effort to strengthen its own offerings for the consumer and small-to-medium business market.

NAI also believes the move would eliminate current customer confusion over the difference between McAfee.com and NAI's McAfee Security product group.

NAI's share price on Monday closed at $11.01 on the New York Stock Exchange, a gain of $0.35 or 3.28 percent on the day. NAI has experienced a 52 week high of $30.50 with a low of $9.45 per share. McAfee.com shares were also higher on the Nasdaq exchange on Monday, closing at $12.84 per share, an increase of $0.21 or 1.65 percent. McAfee.com has experienced a 52 week high of $42.69 with a low of $9.79 per share.