From Michael Dell and Hock Tan to the VMware project Monterrey: 5 key things you need to know
Broadcom could shake up the software industry with the possible acquisition of VMware, a $12 billion hybrid cloud and virtualization superstar that recently became an independent company.
Multiple media outlets are reporting today that San Jose, California-based Broadcom is currently in talks to buy VMware, whose headquarters in Palo Alto, California is close to Broadcom. The deal is under discussion, according to Bloomberg, which was first to report the news.
Broadcom has a market cap of $212 billion, while VMware has a market cap of around $47 billion.
The deal would provide Broadcom with one of the world’s largest enterprise software companies, as well as new technology to power its semiconductor business. Broadcom is a global technology conglomerate with a wide range of products, from storage and networking devices to chips and sensors.
As data centers become even more critical to driving cloud computing, VMware’s strong software position in the data center and the push toward hybrid cloud and software as a service (SaaS) are driving a constant sales growth. Both VMware and Broadcom have thousands of channel partners around the world.
Investment finance firm Wells Fargo said today that VMware would make “strategic sense” for Broadcom.
“Investors have increasingly focused on Broadcom’s appetite for another platform or strategic business software acquisition, especially given the recent compression in software valuation,” Wells Fargo analysts said in a note today. “A VMware acquisition would be considered to make strategic sense; consistent with Broadcom’s focus on developing an ever deeper enterprise infrastructure software strategy.”
It wouldn’t be the first time Broadcom has made a massive IT acquisition, and it wouldn’t be the first time VMware has been acquired by a larger tech giant.
From VMware President and CEO of Dell Technologies Michael Dell to Broadcom CEO Hock Tan’s recent acquisition comments, CRN breaks down the five biggest and most important things to know about the potential acquisition of VMware by part of Broadcom.