News Reports Say Broadcom Seeks VMware Acquisition

The two companies have little overlap. But combined, VMware might offer a way to manage Broadcom's remote devices and equipment in data centers.

News Reports Say Broadcom Seeks VMware Acquisition
(Source: Pixabay)

Multiple news reports today say Broadcom is looking to acquire VMware in what would be one of the largest acquisitions of the decade.

Here is a roundup of some of the reporting:

CNBC: Broadcom, VMware deal could be announced by Thursday, sources say

"CNBC’s David Faber reported Monday that Broadcom had been gearing up to announce its acquisition of VMware as soon as Thursday, but the news could come sooner after several reports said the two companies were in talks."

Yahoo! Finance: Intel CEO weighs in on Broadcom's potential blockbuster deal for VMWare

"Bloomberg reported that fellow chipmaker Broadcom was in advanced talks to buy VMWare. The deal — rumored to come at a hefty cost of $50 billion — would vault Broadcom deeper into cloud computing services."

Bloomberg: Broadcom in Talks to Acquire Cloud Company VMware

"The takeover discussions are ongoing, and there's no guarantee they will lead to an agreement, people with knowledge of the matter said, asking not to be identified because the talks are private. VMware currently has a market valuation of about $40 billion. Assuming a typical premium, the potential deal price would be higher, though the terms under consideration couldn't be learned."

Industry implications

Broadcom's products have been used for years in a wide range of consumer and industrial devices. Increasingly, data centers are envisioned as a source for growth for the company.

VMware offers software used in data centers. Its software is also used for remote access. The two companies have little overlap. But combined, it makes sense that VMware offers a way to manage Broadcom's devices and equipment in data centers.

A billion here, a billion there

Deals worth tens of billions of dollars used to be rare. (No kidding.) The first deals of this magnitude started to appear on a regular basis in the 1980s. Since then, there have been dozens or more deals of that value of even ten times larger.

If the value quoted in the numerous reports about this deal is accurate, it would be the fourth deal this year in the $40 billion-plus range.

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About the Author(s)

Salvatore Salamone, Managing Editor, Network Computing

Salvatore Salamone is the managing editor of Network Computing. He has worked as a writer and editor covering business, technology, and science. He has written three business technology books and served as an editor at IT industry publications including Network World, Byte, Bio-IT World, Data Communications, LAN Times, and InternetWeek.

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