Broadcom, VMware Push ‘Outside Date’ To May; Close-By Date Is Unchanged
The move, which was announced last week in a filing, gives Broadcom and VMware more days—until May 26—to walk away from the deal.
The wedding date hasn’t moved between Broadcom and VMware, but with no certain end to regulatory scrutiny in the U.S., the European Union and the U.K., both companies extended the deadline to walk away from the deal.
The planned $61 billion merger between the Palo Alto, Calif.-based virtualization all-star and the San Jose, Calif.-based chip-making giant was unveiled May 26. The sides had nine months from that date to walk away from the deal, which is known in the industry as an “outside date.” On Feb. 17, a week before reaching that outside date, VMware filed a notice with the U.S. Securities and Exchange Commission that both it and Broadcom had agreed to extend the deadline by 90 days.
“Together with VMware, we have agreed to extend the Outside Date in our merger agreement to May 26, 2023, which is common for a transaction of this size,” a Broadcom statement read. “We are continuing to make progress with regulatory authorities around the world, and we continue to expect the transaction to close in Broadcom’s fiscal year 2023.”
VMware said nearly the same in a statement it provided to CRN.
“We agreed to extend the Outside Date in our merger agreement from February 26, 2023 to May 26, 2023, which is common for a transaction of this size. We continue to expect the transaction to close in Broadcom’s fiscal year 2023,” VMware’s statement read.
The mega merger has set off alarms for regulators around the world. The EU has said it is concerned that Broadcom could use its ownership of the virtualization pioneer to limit or turn off competitors’ access to VMware.
Meanwhile in the U.S., the Federal Trade Commission has been engaged in a stringent “second request” investigation of the merger since July. In a statement to CRN, the FTC declined to provide an update on the investigation.
In a proxy filing this week, Broadcom asked shareholders to approve the direction of the company as well as compensation for its leaders, but offered no futher details on the deal’s progress.
Here are five things to get you caught up on what’s going on with the deal.