Broadcom has received approval from EU regulators for its $61 billion acquisition of VMware, a leading virtualization technology developer. This deal is the third-largest in the IT industry, trailing behind Dell/EMC and Microsoft/Activision Blizzard. The European Commission conducted an antitrust investigation and determined that Broadcom's dominant market position had limited opportunities for abuse, since it isn’t strong enough to allow Broadcom it to fully take over the market. However, certain requirements have been imposed to ensure healthy competition.
In particular, although it’s not likely that VMware and Broadcom software will merge, squeezing out Marvell, one of Broadcom's main competitors, seems more realistic, and could be done by limiting the Fibre Channel adapters compatibility with VMware. To exclude this possibility, Broadcom was obliged to provide other companies with driver source code and tools for creating compatible Fibre Channel adapters.
Broadcom's chips are widely used in smartphones and devices, and this acquisition is expected to significantly bolster its software business, with a particular focus on enterprise software and cloud computing. The deal is still awaiting reviews from the US Federal Trade Commission and the UK's Competition and Markets Authority.
