EU May Block Intel's Acquisition of McAfee on Anti-Competition Grounds

[Amy Miller]

Intel Corp’s $7.68 billion deal to acquire security software company McAfee Inc. could be held up by European officials, the Wall Street Journal is reporting.

The European Union's antitrust regulator has expressed concerns about the deal during a preliminary review. And that could mean the deal will have to undergo a lengthy examination, people familiar with the matter told the paper.

Officials appear concerned that Intel wants to incorporate security features into its microprocessor chips.

The EU is worried that if McAfee, by virtue of being owned by Intel, had privileged access to those features, it could be difficult for its rivals to compete. The commission has sent multiple questionnaires to other security-software companies asking their thoughts about the deal, people familiar with the matter said.

"We believe the combination of Intel and McAfee will prove important in achieving breakthrough innovations in security and look forward to discussing in more detail our product plans and strategies after the transaction is closed," Kevin Sellers, Intel vice president of investor relations, said in a statement.

Sellers said the deal should close in the first half of 2011, but said that Intel has no further details to share. In mid-October, the company said the transaction could close as early as the end of 2010 or in the first quarter.