NAI, McAfee Complete Merger Deal

 
 
By Dennis Fisher  |  Posted 2002-09-13 Print this article Print
 
 
 
 
 
 
 

The two companies expect to complete a special merger agreement, known as a short-form merger, after the close of the stock markets Friday.

After months of wrangling and back-and-forth offers, Network Associates Inc. on Friday announced that it has completed its exchange offer with McAfee.com Corp. The two companies expect to complete a special merger agreement, known as a short-form merger, after the close of the stock markets Friday. NAI executives said the company now owns 96 percent of McAfee.coms stock after shareholders tendered about 10.4 million shares before the deadline, which was Thursday at midnight Eastern time.
The company has named William Kerrigan to head up the new McAfee Consumer division. Kerrigan is a 19-year veteran of IBM, holding a variety of sales and management positions, including running IBM Global Services health care practice. Most recently, he helped found Rebar LLC, a holding and operating company.
The completion of the exchange offer brings to a close a long and twisting courtship between NAI and McAfee.com, which began life as a division of NAI. It took four successively higher exchange offers from NAI before McAfee.coms board accepted the deal. McAfee.com rejected the companys original offer, which was based on an exchange ratio of 0.675 shares of NAI stock for every share of McAfee.com. NAI then raised its offer to 0.78 shares, but later withdrew its bid after it disclosed that the Securities and Exchange Commission was investigating NAIs accounting practices. NAI then began its own internal investigation and eventually said that it would restate three years of financials, which resulted in a narrower profit for 1998 and larger losses for 1999 and 2000. The 1998 net income dropped to $32.4 million from $36.4 million, the 1999 net loss increased by $3 million to $159.9 million, and the 2000 net loss swelled by $21.2 million to $123.9 million. NAI filed its restatement on June 28. McAfee.com accepted the final offer of 0.675 shares and $8 in cash on Aug. 23.
 
 
 
 
 
 
 
 
 
 
 

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