nortonlifelock acquires avira in $360m all-cash deal, 8 months after avira was acquired for $180m

Just eight months following its acquisition for $180 million, Avira is being acquired once more, this time for twice the previous amount. NortonLifeLock announced today its plan to purchase the German security company for approximately $360 million in an all-cash transaction.

This merger and acquisition represents the newest in a series of consolidations and ownership changes involving both organizations. NortonLifeLock emerged as an independent entity last year after Broadcom acquired Symantec’s enterprise security division for nearly $11 billion. Currently, NortonLifeLock operates as a publicly traded company with a market capitalization of around $11.5 billion.

Avira, until April of this year, functioned as an independently funded technology company primarily focused on security software for individual users. Like Norton, its offerings include antivirus software. Avira’s software has also been distributed through partners such as Facebook (within its now-inactive antivirus marketplace). More recently, Avira has expanded its customer base through white-label agreements with major corporations. Current strategic alliances include NTT, Deutsche Telekom, IBM, Canonical, and others. Avira serves millions of customers, securing approximately 30 million devices and supporting 1.5 million paid subscribers (along with a larger number utilizing its free services); when combined with its partnerships, the company states its software is present on roughly 500 million devices worldwide.

Importantly, Avira has established its business around a freemium model, which Norton has stated it intends to maintain.

Private equity firm Investcorp Technology Partners acquired a controlling interest in the company in April, valuing it at $180 million, in order to provide capital for potential acquisitions. This acquisition was significant, both for positioning Avira as a potential consolidator and for indicating a resurgence in the M&A market following a period of inactivity during the initial stages of the global coronavirus pandemic.

Ultimately, Avira itself has become a target for consolidation, rather than a company undertaking acquisitions. NortonLifeLock is expected to utilize this acquisition to bolster its growth, particularly within Europe, where Avira possesses a substantial customer base.

“We are pleased to welcome Avira into the Norton family,” stated Vincent Pilette, CEO of NortonLifeLock, in a press release. “Our goal is to deliver Cyber Safety to everyone, and the addition of Avira’s expanding business will accelerate our international expansion and enhance our market approach with a leading freemium solution. We are also well-aligned culturally, sharing a strong commitment to innovation and a customer-centric approach. We look forward to collaborating with the Avira team.”

Travis Witteveen, Avira’s CEO throughout its various ownership transitions, expressed his enthusiasm for the agreement, noting that it has effectively doubled the company’s valuation (Avira’s founder, Tjark Auerbach, maintained a “significant” ownership stake in the earlier sale to Investcorp, resulting in a substantial return).

“Both NortonLifeLock and Avira are deeply committed to safeguarding consumers’ digital lives,” Witteveen said in a statement. “We are excited to join NortonLifeLock – a company recognized for its trustworthiness and leadership in Cyber Safety. By leveraging NortonLifeLock’s extensive reach, we can extend our protection to a greater number of consumers globally.”

Following the completion of the transaction – anticipated in fiscal year Q4 2021 (or Q1 2022 on the calendar) – Witteveen and Avira’s CTO, Matthias Ollig, will be integrated into the NortonLifeLock leadership team, according to NortonLifeLock.