Intel is selling a majority stake in its security unit McAfee to private-equity firm TPG.
The deal, which will see the company valued at $4.2bn including debt, will see TPG acquire a 51% stake.
Reports surfaced last week that TPG and Intel were in early talks regarding the acquisition of the security unit that Intel acquired for $7.7bn in 2011. The deal marks a significant loss for the chipmaker but given that it will still hold 49% of McAfee it could still be hoping for its fortunes to be turned around.
The company had become known as Intel Security, however, it will now revert back to its original name McAfee.
The business had previously been focused on antivirus programs but this expanded into other areas that focused on corporate network security, this achieved mixed success, but first half revenue rose 11% to $1.1bn in recent financial reporting.
Brian Krzanich, CEO of Intel, said: “Security remains important in everything we do at Intel and going forward we will continue to integrate industry-leading security and privacy capabilities in our products from the cloud to billions of smart, connected computing devices.”
Originally the idea behind the McAfee acquisition was for Intel to build more security features into chips in addition to providing it with a potential route into personal computers.
TPG is making a $1.1bn investment to help expand the business in addition to sharpening its focus as part of the deal, Intel said.
Jim Coulter, Co-Founder and Co-CEO of TPG, said: “We believe that McAfee will thrive as an independent company. With TPG’s investment, along with continued support from Intel, McAfee will sharpen its focus and become even more agile in its response to today’s rapidly evolving security sector.”