Anticipating that its proposed $7.7 billion acquisition of antivirus company McAfee may run into rough weather, world’s biggest chipmaker Intel has offered concessions to the European Commission.
Intel shares fell by 0.8 percent while shares of the world’s second biggest security software maker gained by 1.8 on Thursday.
Intel submitted a proposal committing to deal with competition concerns of the European Commission and was given a deadline extension in return till January 26.
Stating Intel expects an early clearance from the 27 member country watchdog; Chuck Mulloy – spokesman of the chipmaker told Reuters “We’re continuing to work with the Commission. Our expectation continues to be that we get this matter completed sometime in the first half of 2011”.
However, he refused the concessions offered by Intel to complete its biggest ever acquisition.
Sources close to the developments said that the commission is concerned that Intel may embed McAfee’s security features in it microprocessors giving it undue advantage over rival chipmakers.
In an effort to secure their market-share, anti-Virus software makers often forge alliance with PC-makers world wide. Washington based antitrust expert John Briggs said: “I’m reasonably confident that what Intel has agreed to do is to give competitors of McAfee access to the desktops of computers that has McAfee already built into the microprocessor”.
The US Federal Trade Commission has already cleared the deal on December 21.
The high profit and lucrative antivirus business will allow Intel to diversify in the securities market and goes on to show the extent of importance attached to threat posed by online attacks.
Intel can develop new technology by designing chips resistant to hackers. Also, it may embed technology in processors that accelerates the scanning process during boot up.
McAfee’s rivals like Symantec may be disadvantaged after Intel completes the acquisition, fears the European regulator – sources said.