By Rex Crum
McAfee Inc. was a rare bright spot among technology stocks
Thursday, as its shares rose 57% following Intel Corp.'s surprise
$7.7 billion deal to acquire the security-software firm on a day
when most of the sector fell along with the broad market.
McAfee (MFE) climbed $17.08 a share to close at $47.01 after
Intel (INTC) said it would acquire the company for $48 a share -- a
60% premium over McAfee's Wednesday closing price. Intel said
McAfee would help boost the security of its mobile-wireless chip
products, in particular.
"McAfee is the next step in this [mobility] strategy, and the
right security partner for us," Intel Chief Executive Paul Otellini
said in a statement announcing the deal.
After the deal's completion, which still needs the approval of
McAfee shareholders, the company will become a wholly owned
subsidiary of Intel's software and services group.
Intel's shares gave up 69 cents, or 3.5%, to close at $18.90
McAfee rival Symantec Inc. (SYMC) benefited from the deal,
rising 78 cents a share, or 6.2%, to close at $13.37.
Other chip stocks fell along with Intel, as Advanced Micro
Devices Inc. (AMD) fell 15 cents, or more than 2%, to close at
$6.42, and Micron Technology Inc. (MU) gave up 27 cents a share, or
3.6%, to close at $7.18.
Google Inc. (GOOG) fell $14.48 a share, or almost 3%, to $467.97
on the sixth anniversary of the Internet search leader's IPO. In
2004, Google went public using a modified Dutch auction to price
shares at $85 a share in an initial offering of $1.67 billion. The
stock opened at $100, providing those investors who still hold them
a roughly 370% return.
Brocade Communications Systems Inc. (BRCD) shares fell 39 cents,
or 7.6%, to $4.75. Late Wednesday, the storage-technology company
turned in a fiscal third-quarter profit after reporting a loss a
year ago. However, Brocade's fourth-quarter earnings and revenue
outlooks fell short of analysts' expectations.
Other leading tech stocks were in the red, with declines from
Apple Inc. (AAPL), Microsoft Corp. (MSFT), Oracle Corp. (ORCL),
SanDisk Corp. (SNDK) and Yahoo Inc. (YHOO)
One company bucking tech's downward trend was graphics chip
maker Nvidia Corp. (NVDA), which rose 56 cents a share, or 6%, to
$9.88.
Hewlett-Packard Co. (HPQ) fell 60 cents at $40.76 and Dell Inc.
(DELL) gave up 15 cents to close at $12.04. Both computer giants
report quarterly results after the market close.
The Nasdaq Composite Index (RIXF) fell almost 37 points, or
1.7%, to close at 2,178. The overall market was disappointed by the
latest first-time filings for state unemployment benefits. The
number of filers unexpectedly rose last week to 500,000, the
highest level since last November.