In a major development, Broadcom successfully concluded its $69 billion acquisition of cloud-computing firm VMware, marking one of the largest deals globally in 2022. The acquisition had faced prolonged regulatory scrutiny worldwide, with the last major hurdle – regulatory approval from China’s authorities – now overcome.
Broadcom, under the leadership of CEO Hock Tan, aimed to bolster its software business through this strategic move. The deal, initially announced in May 2022, experienced several delays in closing, leading to heightened concerns among investors. The transaction had been postponed three times, with the latest deadline set for November 26, reported Reuters.
The key breakthrough came on Tuesday when China granted regulatory approval, easing tensions that had risen due to the U.S.’s stricter chip export control measures. The approval followed a meeting earlier this month between China’s President Xi Jinping and U.S. President Joe Biden. Improved diplomatic relations played a pivotal role in securing the deal.
Related: EU Regulators Approve Broadcom’s $61 Billion Acquisition Of VMware
Danni Hewson, Head of Financial Analysis at AJ Bell, commented on the positive developments, stating, “The improved mood music after the meeting between China’s President Xi Jinping and U.S. President Joe Biden earlier this month helped to settle remaining nerves.” This reassurance came after Broadcom and VMware announced their intention to close the transaction on November 22.
The regulatory landscape had posed challenges globally, with the European Commission requiring Broadcom to provide remedies to support rival Marvell Technology before granting approval. Meanwhile, the UK’s Competition and Markets Authority (CMA) conducted an in-depth investigation and ultimately gave its green light to the acquisition.
Cabot Henderson, Market Strategist at JonesTrading, expressed cautious optimism about the broader impact of these regulatory successes, saying, “Perhaps we will see some boards being willing to move forward now that we have seen the (Activision Blizzard) and (VMware) get blessing, but don’t think we can count on it.”
Source: Reuters
Featured News
Uruguayan Antitrust Scrutiny Puts Major Meatpacking Deal Between Marfrig and Minerva on Hold
May 19, 2024 by
CPI
Alaska Airlines Seeks Dismissal of Consumer Lawsuit Over $1.9 Billion Hawaiian Airlines Buy
May 19, 2024 by
CPI
Idaho Attorney General Orders Split of Kootenai Health and Syringa Hospital
May 19, 2024 by
CPI
Court Rejects T-Mobile’s Appeal Bid in Antitrust Case Over Sprint Merger
May 19, 2024 by
CPI
Google Requests Judge, Not Jury, to Decide on Antitrust Case
May 19, 2024 by
CPI
Antitrust Mix by CPI
Antitrust Chronicle® – Ecosystems
May 9, 2024 by
CPI
Mapping Antitrust onto Digital Ecosystems
May 9, 2024 by
CPI
Ecosystems and Competition Law: A Law and Political Economy Approach
May 9, 2024 by
CPI
Ecosystem Theories of Harm: What is Beyond the Buzzword?
May 9, 2024 by
CPI
Open Ecosystems: Benefits, Challenges, and Implications for Antitrust
May 9, 2024 by
CPI