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Broadcom announces plans to acquire VMware

Hawk Tang, CEO of Broadcom

Martin H. Simon | Bloomberg | Getty Images

Broadcom will buy VMware as a result of a $ 61 billion cash transaction based on the closing price of Broadcom common stock on May 25, 2022, the companies announced on Thursday.

The deal would be one of the biggest technology acquisitions of all time, following the wait for Microsoft’s deal to buy Activision Blizzard for $ 69 billion and buy Dell EMC for $ 67 billion in 2016.

Buying Broadcom VMware will help the company diversify its core semiconductor design and sales activities into enterprise software that can have higher profits. VMware products are used by enterprises to run their own servers as well as cloud servers.

Broadcom is the most attractive semiconductor company and has strategically used mergers to stimulate its growth in recent years. It previously acquired CA Technologies in 2018 for $ 18.9 billion and Symantec in 2019 for $ 10.7 billion.

But Broadcom has not made a big acquisition since 2019. In March, Broadcom CEO Hawk Tan said the company had “opportunities to acquire a good size.”

Broadcom planned to acquire Qualcomm in 2018 for $ 117 billion before the deal was thwarted by then-President Donald Trump, citing national security.

VMware split from Dell late last year to repay the debt. Dell originally acquired the company when it bought EMC in 2016. Michael Dell, CEO and founder of Dell, owns about 40% of VMware.

News of the deal surfaced last weekend, causing Broadcom shares to fall. VMWare shares rose more than 24% on Monday.

This is the latest news; please check for updates.

Broadcom announces plans to acquire VMware

Source link Broadcom announces plans to acquire VMware

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