Broadcom will buy VMware for $ 61 billion

May 30, 2022 - 20:19
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Broadcom will buy VMware for $ 61 billion

Broadcom has offered more than $ 61 billion in cash and shares to buy VMware, a company whose business is related to Cloud technologies.

This is certainly the largest Broadcom investment to date and the second-largest acquisition in the industry, right after the buyout value offered by Microsoft for Blizzard-Activision ($ 69 billion).

In the beginning, there was little funding, so on May 26, Broadcom made a public offer of $ 142.50 per VMware share, and immediately after the announcement of a possible merger, which has yet to be approved by US and global regulators, Broadcom and VMware shares they increased by 3.5 and 3.1 percent.

With the acquisition of VMware, Broadcom will immediately become one of the largest software giants in the world, standing side by side with Microsoft and others involved in cloud engineering and business.

The company wants to unite the production of chips with software solutions and become one of the most important players in the hardware and software business, which is currently flourishing and its growth is forecast.

VMware is a software company that operates in various areas of IT and is best known for its virtualization services. 

The US FTC, one of the regulatory bodies that will have to consider this purchase, will ask Broadcom for evidence and guarantees that there will be no market monopoly and price increase in the areas in which it operates after the acquisition.

The negotiations between the two companies are based so that VMware has the right to choose another offer within 40 days, but if it chooses the offer of another company outside the mentioned period, it will have to pay Broadcom from 750 million to 1 billion dollars.

Prior to this merger, Broadcom also tried to buy Qualcomm, for which as much as $ 103 billion was offered. The acquisition was rejected due to the low bid during 2017.