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
Judge Allows FTC Antitrust Case Against Amazon to Move Forward
Oct 1, 2024 by
CPI
SAP Leader Urges Caution on EU AI Rules, Warns of Competitive Disadvantage
Oct 1, 2024 by
CPI
Colorado’s Grocery Workers Unite to Oppose $24.6 Billion Supermarket Merge
Oct 1, 2024 by
CPI
Canada’s Competition Bureau Warns Businesses of Tougher Enforcement
Oct 1, 2024 by
CPI
Top Antitrust Lawyers Launch New Boutique Firm
Oct 1, 2024 by
CPI
Antitrust Mix by CPI
Antitrust Chronicle® – Refusal to Deal
Sep 27, 2024 by
CPI
Antitrust’s Refusal-to-Deal Doctrine: The Emperor Has No Clothes
Sep 27, 2024 by
Erik Hovenkamp
Why All Antitrust Claims are Refusal to Deal Claims and What that Means for Policy
Sep 27, 2024 by
Ramsi Woodcock
The Aspen Misadventure
Sep 27, 2024 by
Roger Blair & Holly P. Stidham
Refusal to Deal in Antitrust Law: Evolving Jurisprudence and Business Justifications in the Align Technology Case
Sep 27, 2024 by
Timothy Hsieh