The U.K.’s Competition and Markets Authority (CMA) has been in some of the news in recent months as one of the few regulators to cite concerns over Microsoft’s $69 billion acquisition of Activision Blizzard. However, this is not the only multibillion-dollar deal under scrutiny by the CMA, because The regulator has now started an investigation. In Broadcom’s acquisition of VMware.
For those unfamiliar, Broadcom agreed to buy VMware for a whopping $61 billion in a cash and stock transaction. This includes $8 billion in net debt owed to VMware’s creditors.
While many of our readers will be familiar with VMware because of the company’s work in the software virtualization space, Broadcom emphasized that the transaction “aligns our leading semiconductor and infrastructure software business with one in enterprise software.” Connects with renowned pioneers and innovators as we reimagine what we do. As a critical infrastructure technology company, we can deliver to customers.”
Throwing a wrench into Broadcom and VMware’s plans, the CMA has now launched an investigation into the transaction. Just like the Microsoft-Activision deal, the CMA will investigate whether the acquisition, if successful, would lead to a “substantial lessening of competition for goods or services in any market or markets in the UK”. .
The regulator has already invited comments from interested parties and the results of the Phase 1 investigation are expected by March 22, 2023. If the outcome is not in Broadcom-VMware’s favor, a more detailed Phase 2 investigation will begin soon.