NortonLifeLock’s £6bn purchase of Avast halted by UK regulators
The $8.6bn (£6bn) acquisition of cybersecurity firm Avast by competitor NortonLifeLock has hit a regulatory roadblock from the UK’s Competition and Markets Authority (CMA).
The proposed cash and stock deal has come under scrutiny from the CMA, which has expressed concern that the acquisition could damage the competitiveness of the UK cybersecurity market.
The CMA said that if the acquisition went through, British consumers would be at risk of getting a worse deal for security software.
US-headquartered NortonLifeLock and Prague-headquartered Avast both offer antivirus security software, VPN privacy software and identity protection software.
NortonLifeLock and Avast were approached by the CMA, which requested the companies submit proposed solutions to these concerns.
The concerns were described as “surprising” by NortonLifeLock, which has said it does not plan on proposing any phase one remedies to the CMA.
The completion of the deal has now been delayed to at least some time later this year, instead of the originally planned date of 4 April.
“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,” said CMA executive director David Stewart in a statement.
“NortonLifeLock’s proposed purchase of Avast could lead to a reduction in competition in the UK and ultimately a worse deal for consumers when looking for cyber safety software.
“Unless the companies can offer a clear-cut solution to address our concerns, we intend to carry out an in-depth phase two investigation”.
The CMA gave the companies five working days from Wednesday to submit proposals to address the competition concerns.
The interruption of the deal has reportedly caused the share price of both companies to take a hit. Avast stock dropped 11%, while NortonLifeLock’s stock was down 6% in premarket trading.
The deal has already been given regulatory approval in the US and Germany.