The technology village is about to have a “huge” acquisition of $ 61 billion – Information Technology

Broadcom is acquiring VMware in a massive $61 billion deal that will be one of the largest technology acquisitions to date.

According to Engadget, Broadcom is trying to close its big acquisition efforts. The semiconductor giant is acquiring virtualization and cloud-focused software developer VMware for the equivalent of $61 billion in cash and stock.

The move will transform Broadcom’s software division into VMware and create a powerhouse that enables companies to run applications in all types of environments, including any cloud service.

VMWare is being targeted by chip giant Broadcom.

The proposed merger would leave Broadcom with VMware’s $8 billion in debt. The deal will end at some point in Broadcom’s fiscal 2023 if regulators approve the deal. However, it is worth noting that VMware is not yet fully locked in the merger, which allows the company to review and even solicit deals from other companies intending to deal. until 5/7.

If the deal goes smoothly, it will represent one of the biggest tech deals to date. Previously, in 2015, Dell (who is on the board of VMware) set a record for several years when it acquired EMC, then-owner of VMware, for $67 billion. However, Microsoft has eclipsed that with an ongoing acquisition targeting Activision Blizzard for $68.7 billion.

This scenario is not surprising. In addition to the existing debt, VMware is seeing a decline in profits and a modest increase in revenue. This agreement can help the company overcome those obstacles and improve its competitiveness.

However, Broadcom may also face some obstacles. In 2018, former President Trump blocked Broadcom from buying Qualcomm because of national security concerns. While the governance and acquisition goals are different this time around, it wouldn’t be surprising if Broadcom faces similar levels of scrutiny.