NortonLifeLock shares are soaring a day after the security firm said it would acquire rival Avast in a deal worth between $8.1 billion and $8.6 billion.
Shares of NortonLifeLock, formerly known as Symantec, were up about 8.7% to $26.25 at the market’s close on Wednesday. Investors appear to be pleased that the firm is joining forces with another major security software vendor and consolidating the market.
Both NortonLifeLock and Avast sell antivirus software and other related consumer-centric security products. Their offerings include phishing-protection, password managers, and tools for accessing the Internet using virtual private networks, or VPNs.
In 2019, Symantec changed its name to NortonLifeLock after chip vendor Broadcom bought its enterprise security business for more than $10 billion. Three years earlier, Symantec had acquired Blue Coat, an IT firm known for helping companies scan Internet traffic for threats, in a nearly $5 billion deal.
NortonLifeLock turned heads when it hopped on the cryptocurrency bandwagon in June. The company said its popular Norton 360 antivirus software would let users “mine” Ether, the cryptocurrency associated with Ethereum. (Hackers sometimes install surreptitious crypto-mining software on people’s machines to make a profit, an attack called “cryptojacking.”)
In a product update in July, NortonLifeLock pitched the Norton Crypto feature as a safer way for people to mine cryptocurrencies while their computers are idle without having to disable their device’s security tools. The firm said that it would “look at potentially adding other currencies in the future.”
Avast, on the other hand, recently came under fire after Czech Republic regulators said they would investigate the firm following reports from PCMag and Motherboard that Avast sold user data via a subsidiary business, potentially violating data privacy rules. Avast eventually shuttered the data-collection business unit, but maintained that the business did not violate European data privacy laws.
The pending acquisition marks another major tech deal as a wave of cybersecurity and related ransomware incidents plagues corporate America. Just this past July, Microsoft said it would acquire security startup RiskIQ in a deal reportedly worth $500 million. Another security vendor, Rapid7, said it would buy smaller security firm IntSights for $335 million.
NortonLifeLock said that after the deal closes, the company will maintain two headquarters. One will be in Tempe, Ariz., where NortonLifeLock is headquartered, and the other will be in Avast’s home city of Prague.