INSUBCONTINENT EXCLUSIVE:
Broadcom, the massive semiconductor supplier you may remember from its failed attempt to acquire Qualcomm, today announced that it has
reached a definitive agreement with CA Technologies, a major IT management software and solutions provider
The price of the acquisition is $18.9 billion in cash
CA shareholders will receive $44.50 per share, a 20 percent premium over the closing price of the company stock today.
It a bit of a
surprise to see chip manufacturer Broadcom acquire a major software and services company
&This transaction represents an important building block as we create one of the world leading infrastructure technology companies,&
BroadcomCEO and president Hock Tan explains in today announcement
&With its sizeable installed base of customers, CA is uniquely positioned across the growing and fragmented infrastructure software market,
and its mainframe and enterprise software franchises will add to our portfolio of mission critical technology businesses
We intend to continue to strengthen these franchises to meet the growing demand for infrastructure software solutions.&
This comment
doesn&t exactly explain the rationale behind today acquisition, but Broadcom is clearly trying to diversify its offerings
Earlier this year, the company walked away from its proposed hostile takeover of Qualcommafter the Trump administration blocked it
At the time, Broadcom was willing to pay $117 billion for Qualcomm, which would have greatly extended the company semiconductor business
Today move sees Broadcom enter a completely new business.
The company expects the acquisition to close in the fourth quarter of 2018
It unlikely that Broadcom will face any major headwind from Washington this time around.
