After receiving regulatory approval in China, Broadcom completed its $69 billion acquisition of cloud-computing firm VMware, ending a months-long saga. The deal, announced in May 2022, is one of the biggest globally and marks CEO Hock Tan’s efforts to boost the chipmaker’s software business.
Although the transaction faced tough regulatory scrutiny across the world and the closing date was delayed three times, China’s approval came through on Tuesday. Ongoing tensions with the U.S. around tougher chip export control measures had stoked fears among investors regarding the closing of the deal before the Nov. 26 deadline.
Danni Hewson, head of financial analysis at AJ Bell, stated that “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” after the companies stated their intention to close the transaction on Nov.22.
The European Commission and UK’s Competition and Markets Authority both approved the acquisition after Broadcom offered remedies. Cabot Henderson, a market strategist at JonesTrading, expressed uncertainty about the future of Tech mergers after the U.S. Federal Trade Commission’s heightened regulatory pressure under its Chair Lina Khan.
(Reporting by Harshita Mary Varghese; Editing by Sriraj Kalluvila)
