Broadcom’s acquisition of VMware to give a strong boost for Cloud Computing

US semiconductor company Broadcom is set to acquire VMware in a $61 billion cash-and-stock deal expected to close in Broadcom’s fiscal year 2023.

Broadcom’s deal with VMware is the latest among recent mergers and acquisitions which Broadcom has embarked on as part of its push into the software industry. In 2018, Broadcom acquired CA Technologies for $18.9 billion; a year later, it acquired Symantec’s enterprise security unit for $10.7 billion.

On the Cloud

Broadcom’s acquisition of VMware, which specializes in cloud computing and virtualization technology, is projected to enhance Broadcom’s stake in the enterprise software industry. As part of the deal, Broadcom Software Group will be rebranded to VMware, combining VMware’s multi-cloud portfolio with Broadcom’s existing infrastructure and security software solutions.

In a press release announcing the transaction, CEO of Broadcom Hock Tan said that the combination of Broadcom’s semiconductor and infrastructure software business, with VMware’s expertise in enterprise software, would further cultivate a shared culture of innovation.

Raghu Raghuram, CEO of VMware said: “Combining our assets and talented team with Broadcom’s existing enterprise software portfolio, all housed under the VMware brand, creates a remarkable enterprise software player.”

While unanimously backed by Broadcom’s board of directors, the deal remains subject to the receipt of regulatory approvals and customary closing conditions, including approval by VMware’s shareholders.

Together with Silver Lake, Chairman of VMware’s Board Michael Dell owns around 50 per cent of VMware. Dell affirmed his support for the transaction, saying that  “together with Broadcom, VMware will be even better positioned to deliver valuable, innovative solutions to even more of the world’s largest enterprises.”

The Asia-Pacific cloud computing market is becoming more mainstream, especially in India, China, Japan, and Singapore: regionally,  adoption of cloud technology has accelerated, with constant improvement in technological development. Moreover, the outbreak of COVID-19 has impacted the Asia-Pacific cloud computing market in a positive manner.

Large companies are focusing on implementing work from home, to safeguard their employees from catching the coronavirus. This factor caused a surge in demand for Software-as-a-Service (SaaS) based solution and tools.

For instance, the Microsoft Team platform witnessed an increase of 44 million, owing to the strong demand for online collaboration solutions. In addition to this, strong demand for streaming platforms, such as Netflix, Amazon, Disney +, and various other emerging platforms, will open new doors for the growth of the market in the coming years.

If the deal between Broadcom and VMware closes, it will be one of Broadcom’s largest acquisitions to date.

Publish on W.Media
Author Info:
Picture of Lois
Lois
Share This Article
Related Posts
Other Popular Posts
Southeast Asia News