McAfee LLC is preparing an initial public offering that could happen as soon as this year and raise more than $1 billion, the Wall Street Journal reported today.

The publication’s sources said that the cybersecurity powerhouse is already holding talks with banks about its IPO plans. The listing could reportedly value McAfee at more than $5 billion.

That would provide a handsome exit for private equity firm TPG Capital, which bought a 51% stake in the company from Intel Corp. three years ago at a $4.2 billion valuation, or $2.15 billion not including debt.

McAfee’s third co-owner is Thoma Bravo, which acquired an undisclosed minority stake in 2017. Reports emerged last December that the private equity firm was looking to buy out TPG and Intel at a “significant premium” to McAfee’s $4.2 valuation from 2016.

The tipsters who spoke to the Journal confirmed that the companies have considered selling McAfee. TPG and Intel are reportedly still leaving that option open, but they’re said to be leaning more toward an IPO because of how well other security providers have been trading the stock market recently. Perhaps the most notable example is CrowdStrike Holdings  Inc., which has seen its share price nearly double since going public last month.

Another McAfee rival that saw its stock spike recently is Symantec Corp. Investors sent the company’s share price soaring double-digits last week after word leaked that Broadcom Inc. is moving in for an acquisition. If sealed, the deal could reportedly be worth more than $15 billion.

McAfee has made some acquisitions of its own since TPG became its majority stakeholder in 2016. The company bought virtual network provider TunnelBear Inc. and Skyhigh Networks Inc., a startup that developed technology for protecting data companies store in the cloud. 

The Skyhigh platform now plays a central role in McAfee’s product strategy. The company has rebranded the offering as Mvision since the deal was completed and added deeper integrations with major cloud platforms, notably Amazon Web Services and Google Cloud.

McAfee also continues to maintain a big presence in the antivirus segment, as well as other parts of the sprawling cybersecurity market. The company’s portfolio includes threat detection software, tools for coordinating network security operations and products that automate related tasks, such as preventing data loss.

Steve Wilson, vice president and principal analyst at Constellation Research Inc., told SiliconANGLE that the recent dealmaking in cybersecurity indicates the business model is still shaking out even after 20 years or more.

“It’s amazing when you think about it that Symantec and McAfee still exist in the current forms,” he said. “You don’t buy a car and then shop around for seat belts and airbags. Safety should be table stakes but with computing, it’s still a totally separate business model. I really thought that by now, security companies would have all been acquired by telcos and product firms and assimilated.”

In the absence of that consolidation, Wilson added, “we need to move much faster to safety being integrated into software apps, mobile phones and the ‘internet of things’ and managed security being integral to internet connectivity.”

International Data Corp. analyst Robert Westervelt said he thinks McAfee will remain relevant for years to come thanks to its strong portfolio of products that it’s gradually enabling for the cloud. “The shift from on-premises security components to cloud-delivered components means that McAfee customers may move from a standard licensing model to subscription-based model,” he said. “Historically that has resulted in short-term revenue decline followed by a period of strong growth. As this unfolds at McAfee, the IPO might generate the investment required to modernize the entire portfolio and assist in getting customers on the right migration path to experience that period of strong growth sooner rather than later.”

That said, Westervelt noted that AWS, Microsoft Azure, Google and other cloud providers are providing their own broad range of cybersecurity services. “The challenge ahead for McAfee and Symantec is to educate chief information security officers and other security buyers in how their portfolio can assist in reducing the complexity of managing security across hybrid and multicloud environments,” he said. “Our survey data suggest that security product complexity is a significant issue and our analysis is that this complexity partially stems from attempts to bolt on components to extend traditional security solutions to address data protection across multiple cloud environments.”

SiliconANGLE Media’s livestreaming video studio theCUBE spoke with Eric Boerger, enterprise technology specialist for private and public cloud at McAfee, in December about Skyhigh’s and McAfee’s growing cloud services and how they can help enterprises better deal with security issues:

With reporting from Robert Hof

Photo of McAfee CEO Chris Young: McAfee