Broadcom acquires VMware in a $61 billion cash-and-stock deal† It is one of the largest tech acquisitions ever, following Dell’s $67 billion EMC deal and Microsoft’s upcoming $68.7 billion acquisition of Activision Blizzard. Broadcom is known for its chip business, designing and manufacturing semiconductors for modems, Wi-Fi and Bluetooth chips across multiple devices.
This massive acquisition for VMware is intended to boost Broadcom’s software business. VMware, which was owned by Dell until it was spun off last year, focuses on cloud computing and virtualization technology. If you’ve used a virtual machine at work for the past decade, chances are it was powered by VMware or its competitor Citrix. Devices from Apple, Google, and more use Broadcom chips, and it’s likely that the devices you’ve been using Wi-Fi or Bluetooth on were likely powered by Broadcom chips in some part of the network chain.
The combination of VMware and Broadcom could be a powerful one, targeting enterprise infrastructure and cloud computing. Broadcom earlier acquired CA Technologiesmakers of security and database software, for $18.9 billion in 2018, and it even acquired Symantec’s enterprise security unit for $10.7 billion in 2019. Less than 12 months later sold the Symantec business to Accenture for an undisclosed amount.
Broadcom now plans to rebrand its Broadcom Software Group to VMware and incorporate its existing infrastructure and security software offerings as part of VMware. “Combining our resources and talented team with Broadcom’s existing enterprise software portfolio, all under the VMware brand, creates a remarkable enterprise software player,” said VMware CEO Raghu Raghuram.
The deal, expected to close in Broadcom’s fiscal year 2023, has the backing of Michael Dell, who along with Silver Lake owns about 50 percent of VMware. If the deal closes, it will be one of the biggest tech deals of all time. Broadcom previously failed to buy rival chipmaker Qualcomm for more than $100 billion after the Trump administration blocked the deal, citing national security concerns.