In a press release, Broadcom has formally announced its acquisition of VMware valued at US$61 billion in cash and stock. The company called this a “strategy to build the world’s leading infrastructure technology company.”
The current Broadcom Software Group will now be rebranded as VMware and merge Broadcom’s enterprise infrastructure and security products with VMware’s virtualization offering.
Tom Krause, president of the Broadcom Software Group, envisions a strong synergy and little overlap between the two companies.
“VMware’s platform and Broadcom’s infrastructure software solutions address different but important enterprise needs, and the combined company will be able to serve them more effectively and securely. We have deep respect for VMware’s customer focus and innovation track record and look forward to bringing together our two organizations,” he stated.
VMware Chairman of the Board Michael Dell endorsed the deal subject to VMware board approval.
“Together with Broadcom, VMware will be even better positioned to deliver valuable, innovative solutions to even more of the world’s largest enterprises,” he said.
Broadcom shareholders will own approximately 88 per cent and current VMware shareholders will own 12 per cent of the merged company.
The purchase is set to be completed in Broadcom’s fiscal year 2023, but is subject to regulatory approvals and other conditions, including approval by VMware shareholders.