Broadcom Acquired VMware - The Chipmaker Giant Closed This Deal at $61 Billion

After several rumors and news, the chipmaker giant Broadcom finally confirmed the news of it buying a cloud services provider VMware at $61 billion. With this cash-and-stock deal purchase, Broadcom plans to diversify its business. According to the deal, Broadcom will assume VMware’s $8 billion net debt, and its shareholders will get $142.50 per share. If we rank the biggest acquisitions in 2022, then after the microsfot and Activision Blizzard $68.7 billion deal, this Broadcom - VMware deal is in the second rank.

Speaking about this acquisition news, Broadcom stated in its press release that this deal would help it to become the world’s leading infrastructure technology company. Further adding to the comment, the company said that adding the leading VMware platform with the complementary Broadcom Software portfolio will provide customers with critical infrastructure solutions to improve innovation and address the most complex information technology infrastructure needs.

Broadcom can also improve its income with this deal, as VMware’s last year's revenue was $11.8 billion, which is larger than Broadcom software group’s $7 billion revenue. The company will also rebrand its software group’s name to VMware, and it will be an “expanded VMware portfolio” with the inclusion of Broadcom’s existing infrastructure.

Reacting to this deal, VMware’s CEO, Mr. Raghu Raghuram, said that with the combination of VMware’s talented team and assets with Broadcom’s existing enterprise software portfolio, all the departments under VMware will see the rise of a remarkable enterprise software player.

If we talk about Broadcom’s decades-long business history, its current market cap is $217.05 billion, and by acquiring VMware, the enterprise software will account for 49% of its annual revenue. And VMware was founded in 1990, and since then, it has been the top company in virtualization technology. In 2021, Dell Technologies spun off VMware shares.