McAfee Associates Inc. dropped its $1 billion offer to buy Cheyenne Software Inc. Wednesday, saying Cheyenne’s rejection was not worth fighting.
Cheyenne’s stock plummeted on the news but the company said it was pleased it no longer had to deal with the “distracting issue” of McAfee’s offer.
Cheyenne shares finished down $4.25 to $19.75, a 17 percent drop, on the American Stock Exchange. McAfee shares rose $1.25 to $62.50 on the Nasdaq Stock Market.
The two software companies had held discussions privately last fall and in November about a merger.
But the talks took an unusual turn last month when Cheyenne publicly disclosed McAfee’s offer and said it had rejected it.