(Correcting Avast's market capitalisation.)
(Alliance News) - The UK Competition & Markets Authority on Friday confirmed it has cleared NortonLifeLock Inc's acquisition of its cybersecurity peer, following an in-depth merger investigation.
Tempe, Arizona-based NortonLifeLock had agreed, back in August 2021, to buy Prague-based Avast in a cash-and-shares deal worth USD8.6 billion at the time.
Shares in Avast were up 0.4% at 716.00 pence in London early Friday, giving it a market capitalisation of around GBP7.52 billion, about USD8.69 billion.
In March 2022, the UK's CMA referred the merger to a phase 2 investigation, after identifying competition concerns during an initial phase 1 investigation. Both companies offer cyber safety software to consumers under a variety of different brands. Products include antivirus software, privacy software and identity protection software.
In early August, the the CMA said it had provisionally cleared the deal, finding that the enlarged firm still faces stiff competition.
On Friday, the CMA confirmed this view and gave the deal the green light.
"The CMA's Phase 2 investigation has found that the supply of cyber safety software to consumers is rapidly evolving. Providers of paid-for and free services are continually developing and improving their products to meet different and changing customer needs," the watchdog said.
The enlarged firm still faces stiff competition, including its "main rival", San Jose, California-based McAfee LLC, the CMA explained. In addition, Microsoft Corp's own in-house cybersecurity applications in the Window operating system are "increasingly important alternatives for consumers".
It added that, in recent years, Microsoft has improved its built-in, bundled security application so that it now offers protection which is "as good as" many of the products offered by specialist suppliers. This will strengthen Microsoft as a competitor going forward.
"Phase 2 investigations allow us to explore concerns identified in our initial review in more detail, as we gather further information from the companies involved and other industry players. After reviewing the evidence in an in-depth review, we are now satisfied that this deal won't worsen the options available to consumers," said Kirstin Baker, chair of the CMA inquiry group.
By Sophie Rose; sophierose@alliancenews.com
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