Avast Software has acquired AVG Technologies (NYSE: AVG) for an amount of $1.3Bn. As per the deal, Avast will purchase all the outstanding ordinary shares of AVG for $25.00 per share in cash, which amounts to a total consideration of approximately $1.3 Billion. Since both Avast and AVG are based in the Czech Republic, they will be able to contribute to the overall growth of the security industry to a large extent.
Approved by the Management and Supervisory boards of both Avast and AVG, Avast is looking forward to increasing scale with the essential technological and geographical breadth to take advantage of emerging growth opportunities in Internet Security including the efficiency of the organization.
With a combined network of more than 400 million endpoints and 160 million mobile points, both Avast and AVG will be able to provide accurate information about wide range of malware, which will help detect, fight and eradicate new threats. The acquisition enables both companies to share information between each other, which was previously not possible. Moreover, Avast will be able to create technically advanced security and privacy products.
Commenting on the merger, Vince Steckler, chief executive officer of Avast Software disclosed that the acquisition provides the company with all the required technological innovations to build next generation security products, which will not only benefit current but also upcoming customers. Since both companies are founded in the Czech Republic, we share a common culture and mission and hence we will be in an excellent position to leverage the new opportunities in the future.
Soon after the acquisition announcement, Avast has outlined that the deal will be finalized using cash balances on hand and committed debt financing amounting to $1.685 billion from third-party lenders such as Credit Suisse Securities, Jefferies, and UBS Investment Bank. Moreover, Avast has also contributed $150 million in equity investment to fund the overall transaction.
Responding to media, Gary Kovacs, chief executive officer, AVG revealed that by joining forces with Avast, AVG will be able to accelerate investments in growing markets to continue to focus on providing comprehensive and simple-to-use solutions for both consumers and businesses.
While Jefferies International Limited is acting as financial advisor to Avast, Morgan Stanley oversees the role for AVG. Talking about legal advisors, White & Case LLP and De Brauw Blackstone Westbroek N.V will be in charge of Avast and Orrick, Herrington & Sutcliffe LLP and Allen & Overy LLP have assumed charge for AVG.