Intel will spin out its Intel Security division in a collaboration with investment firm TPG, with the transaction valuing the business at US$4.2 billion.

Under a definitive agreement, the two parties will establish a newly formed, jointly owned independent cybersecurity company, operating as McAfee.

Intel, which had acquired McAfee in 2011 in a deal worth US$7.7 billion, will hold a 49 per cent stake in McAfee and TPG a 51 per cent stake, with TPG to make a US$1.1 billion equity investment.

The deal will see Intel receive US$3.1 billion in cash.

Intel senior vice president and Intel Security general manager Chris Young will be appointed CEO of the new company.

“As a standalone company supported by these two partners, we will be in an even greater position of strength, committed to being the best provider the cybersecurity industry has ever seen,” Young commented.

“We will continue to focus on solving the unique demands of customers in the dynamic cybersecurity marketplace, drive innovation that anticipates future market needs and continue to grow through our strategic priorities.”