EU Investigates Broadcom's Proposed $61 Bln Acquisition Of Vmware Over Competition Concerns

(RTTNews) - The European Commission has opened an in-depth investigation into Broadcom Inc.'s (AVGO) proposed $61 billion acquisition of Vmware Inc. (VMW), citing concerns that the transaction would allow Broadcom to restrict competition in the market for certain hardware components. This could lead to higher prices, lower quality and less innovation for business customers, and ultimately consumers.

The proposed transaction was notified to the Commission on 15 November 2022. The Commission now has 90 working days, until 11 May 2023, to take a decision, the European Commission said in a statement.

Broadcom is a hardware company that offers, among other products, Network Interface Cards, Fibre Channel Host-Bus Adapters and storage adapters. Broadcom recently started expanding into software markets.

VMware is a software provider offering mainly virtualisation software which interoperates with a wide range of hardware, including NICs, FC HBAs and storage adapters.

In May 2022, Broadcom agreed to acquire VMware in around $61 billion cash-and-stock deal. In addition, Broadcom would assume $8 billion of VMware net debt.