UPDATED 22:23 EDT / MARCH 16 2022

SECURITY

NortonLifeLock’s acquisition of Avast on hold pending UK inquiry

NortonLifeLock Inc.’s acquisition of Avast plc has a hit a spanner in the works as the U.K. government put the deal on hold until further information is provided.

The U.K. Competition and Markets Authority have ruled that the deal raises competition concerns and may now be referred for an in-depth investigation. More specifically, the CMA said, the deal could lead to U.K. consumers getting a worse deal when looking for cybersecurity safety software in the future.

Both companies have been given five working days to submit proposals to address the CMA’s competition concerns. The CMA then has an additional five working days to consider whether to accept any offer instead of referring the case for further investigation.

“We are living more of our lives online and it is vital that people have access to competitive cyber safety software when seeking to protect themselves and their families,” CMA Executive Director David Stewart said in a statement today. “Unless the companies can offer a clear-cut solution to address our concerns, we intend to carry out an in-depth phase 2 investigation.”

Reports that NortonLifeLock was in talks to acquire Avast first emerged in July, with the deal announced in August. The deal valued Avast at between $8.1 billion and $8.6 billion.

Founded in 1988, Avast makes digital security products for consumers and businesses. The company is best known for its desktop products, Avast and AVG, the latter acquired by Avast for $1.3 billion in 2016.

If that description of Avast sounds familiar, it’s because it’s a significant competitor to NortonLifeLock. That’s the concern the CMA has with the deal. According to one source, AVG, owned by Avast, is estimated to have a 26% antivirus market share while Norton has a 4.6% share. The second-place holder, McAfee, has a 17% share. Based on broader malware protection, Statista rates the numbers differently, with NortonLifeLock, previously Symantec Corp., sitting in top place with a 13.1% share, followed by Avast with a 12.7% share as of May 2020 for Windows computers.

The counterargument is that the merged companies would not hold more than a third of the market and there is significant competition, but it would be the strongest player in the market.

Photo: NortonLifeLock/YouTube

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