Broadcom closes $69 billion VMware deal after China approval

(Reuters) — Broadcom on Wednesday closed its $69 billion acquisition of cloud-computing agency VMware after receiving regulatory approval in final main market China and ending a months-long saga.

The deal, one of many greatest globally when introduced in Might 2022, was the newest in CEO Hock Tan’s efforts to spice up the chipmaker’s software program enterprise.

Nonetheless, the transaction confronted robust regulatory scrutiny the world over and the businesses had delayed the cut-off date thrice.

China’s regulatory approval got here by way of on Tuesday after ongoing tensions with the U.S. round more durable chip export management measures had stoked fears amongst some traders on the corporate’s capacity to shut the deal earlier than the Nov. 26 deadline.

“The improved temper music after the assembly between China’s President Xi Jinping and U.S. President Joe Biden earlier this month helped to settle remaining nerves,” Danni Hewson, head of monetary evaluation at AJ Bell, mentioned on Tuesday, after the businesses mentioned they deliberate to shut the transaction on Nov. 22.

President Joe Biden greets China's President President Xi Jinping at the Filoli Estate in Woodside, Calif., Wednesday, Nov, 15, 2023, on the sidelines of the Asia-Pacific Economic Cooperative conference. (Doug Mills/The New York Times via AP, Pool)

President Joe Biden greets China’s President President Xi Jinping on the Filoli Property in Woodside, Calif. on Nov, 15. (Doug Mills/ The New York Instances by way of AP) (ASSOCIATED PRESS)

The European Fee had authorized the acquisition after Broadcom supplied cures to assist rival Marvell Know-how whereas the UK’s Competitors and Markets Authority (CMA) gave its inexperienced gentle following an in-depth investigation.

“Maybe we are going to see some boards being keen to maneuver ahead now that we’ve got seen the (Activision Blizzard) and (VMware) get blessing, however do not suppose we will rely on it,” mentioned Cabot Henderson, market strategist at JonesTrading, on Tuesday.

Large Tech mergers akin to Microsoft’s now-closed $69 billion buy of the “Name of Responsibility” writer Activision have confronted heightened regulatory strain from the U.S. Federal Commerce Fee below its Chair Lina Khan.

(Reporting by Harshita Mary Varghese; Modifying by Sriraj Kalluvila)

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