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Only eight months after getting acquired for $180 million, Avira is changing hands again, for double the value: NortonLifeLock today announced that it would acquire the German security firm for around $360 million in an all-cash deal.
The M&A deal is the latest of a series of consolidations and shifts in ownership around both companies: NortonLifeLock came into existence as a standalone company only last year after Symantec's enterprise security business was acquired by Broadcom for nearly $11 billion. NortonLifeLock is itself today a publicly traded company with a market cap of about $11.5 billion.
Avira, meanwhile, was until April of this year a bootstrapped tech business focusing mainly on security software for consumers. Its products include -- like Norton itself -- anti-virus software. In Avira's case (as with Norton's) that software has been resold by the likes of Facebook (as part of its now-dormant antivirus marketplace). In more recent years, Avira's clocked up more customers via the white-label deals it makes with big names. Strategic partners today include NTT, Deutsche Telekom, IBM, Canonical and more. Avira has a customer base of millions, covering about 30 million secured devices and 1.5 million paying customers (and many more taking free services); combining that with its white-label partners, it says its software touches about 500 million devices globally today.
Notably, Avira has built its business around a freemium model that Norton said it plans to keep.
PE firm Investcorp Technology Partners acquired a majority stake in the company giving it an enterprise valuation of $180 million in April in part to inject some money into the business to give it more firepower to make acquisitions of its own. At the time, it was a notable acquisition not only for putting Avira on the map as a consolidator, but as a signal that the M&A market was picking up after it went dormant in the early days of the coronavirus gripping the global economy.
Ultimately, it looks like Avira became one of the consolidated, instead of a consolidator. NortonLifeLock is likely to use the asset to help it grow specifically in Europe, where Avira has a strong customer base.
“I am delighted to welcome Avira to the Norton family,” said Vincent Pilette, CEO, NortonLifeLock, in a statement. “We strive to bring Cyber Safety to everyone, and acquiring Avira adds a growing business to our portfolio, accelerates our international growth and expands our go-to-market model with a leading freemium solution. Culturally, we are a great match. We share a relentless focus on delivering innovative products to customers and we always think customer-first. We cannot wait to get started with Avira.”
Travis Witteveen, who has been the CEO of Avira through its many phases of ownership, said in a statement that he is "thrilled" with the deal, which has effectively doubled the valuation of his company (in the earlier sale to Investcorp, Avira founder Tjark Auerbach retained a “significant” stake of the company, so that gives him a tidy sum, too).
“NortonLifeLock and Avira are fiercely dedicated to helping protect consumers’ digital lives,” said Witteveen in a statement. “We are thrilled to become part of NortonLifeLock – a company that is synonymous with trust and leadership in Cyber Safety. By leveraging the scale of NortonLifeLock, we can reach and protect more consumers around the globe.”
After the deal closes -- which is expected to happen in fiscal year Q4 2021 (or Q1 2021 in the calendar year) -- Witteveen and Avira's CTO Matthias Ollig will join the NortonLifeLock leadership team, NortonLifeLock said.