Broadcom expects EU approval of VMware acquisition • The Register
Broadcom has begun receiving European Union approval for its proposed $61 billion acquisition of cloud and virtualization business VMware, which the company expects to close in the current fiscal year.
The acquisition was formally submitted to the European Commission for antitrust scrutiny on November 15, according to a post on the executive body’s competition policy website. The tentative deadline for a decision on the merger is December 20, but an official press release with details has yet to be issued.
Broadcom is reportedly aiming for the merger to be approved at this stage, rather than the European Commission deciding a more in-depth analysis is needed, which could add months to the approval process.
“We are confident that this deal will not raise any competition issues and look forward to working with the European Commission throughout this process,” the company said in a statement.
As we reported last month, Broadcom is hoping to persuade EU regulators to give the green light to its acquisition, arguing that there is already plenty of competition in the relevant market sectors from public cloud providers like Microsoft, AWS and Google, and being a merger will actually increase buyer choice.
However, the U.S. Federal Trade Commission is believed to be also scrutinizing the proposed acquisition, which could also derail the sale.
The fabless semiconductor company confirmed its intention to acquire VMware in May after the latter spun off from Dell last year, with the boards of both companies unanimously approving the $61 billion purchase.
However, VMware customers were less than pleased with the proposed acquisition. Participants at one of the company’s user group conferences in Melbourne, Australia shared The registry that they feared the worst after seeing previous acquisitions by Broadcom leading to price hikes and reduced investment in product development.
Broadcom has denied this, and the company’s President and CEO, Hock Tan, even wrote a blog post last month stating that raising the prices of VMware products is not part of his strategy.
July ended the 40-day “go-shop” period during which VMware could seek alternative proposals under the merger agreement, paving the way for the Broadcom acquisition to proceed.
Assuming Broadcom clears regulatory hurdles, the company expects the transaction to close sometime in fiscal 2023, which began this month. ®
https://www.theregister.com/2022/11/16/broadcom_looks_for_eu_approval/ Broadcom expects EU approval of VMware acquisition • The Register