Intel today announced it had agreed to buy security software company McAfee for $48 a share in a cash deal valued at about $7.68bn.

Intel said the acquisition reflects that security is now a fundamental component of online computing. It said today’s security approach does not fully address the billions of new Internet-ready devices connecting, including mobile and wireless devices, TVs, cars, medical devices and ATM machines as well as the accompanying surge in cyber threats. Providing protection to a diverse online world requires a fundamentally new approach involving software, hardware and services.

McAfee which had double-digit, year-over-year growth and nearly 80% gross margins last year, will become a wholly-owned subsidiary of Intel, reporting into Intel’s Software and Services Group.

McAfee, like Intel is based in Santa Clara, in the heart of California's Silicon Valley  and was founded in 1987. It is the world’s largest dedicated security technology company with approximately $2bn in revenue in 2009. It has about 6,100 employees.

“With the rapid expansion of growth across a vast array of Internet-connected devices, more and more of the elements of our lives have moved online,” said Paul Otellini, Intel president and CEO. “In the past, energy-efficient performance and connectivity have defined computing requirements. Looking forward, security will join those as a third pillar of what people demand from all computing experiences.

“The addition of McAfee products and technologies into the Intel computing portfolio brings us incredibly talented people with a track record of delivering security innovations, products and services that the industry and consumers trust to make connecting to the Internet safer and more secure,” Otellini added.

Intel to pay $48/share in cash for McAfee, with CNBC's Jon Fortt: