US chipmaker Broadcom has agreed to acquire cloud software company VMware for $69bn, including debt, in a takeover that signals the market for large corporate mergers might be thawing after a stock market rout at the start of the year.
VMware shareholders will be able to choose to receive either $142.50 in cash or 0.2520 shares of Broadcom stock for each of their shares in the software group, at a 33 per cent premium over the value of the company before talks emerged last week.
The takeover, which is being supported with $32bn in bank financing, would help transform Broadcom, an acquisitive semiconductor group, into a diversified tech company ranging from chips to cloud computing services.