FTC ‘Second Request’ Investigation Of Broadcom-VMware Deal Launches: 5 Things To Know
Broadcom told CRN in a statement that it had expected the ‘second request’ by the FTC and Justice Department due to Broadcom and VMware’s size and scale.
What it means when a pending acquisition gets a second request from the FTC
The FTC said a second request means the deal “has raised competition issues,” which has prompted the agency to ask the parties to turn over more information so it can take a closer look at how the transaction will affect commerce.
“The vast majority of deals reviewed by the FTC and the Department of Justice are allowed to proceed after the first, preliminary review,” the FTC writes on its site describing the action. “However, if a second request is issued, the companies must provide more information.”
Vedova, a lawyer who has been with the agency since 1990, wrote on the FTC’s site that if the FTC or DOJ seeks additional information through a “second request” the deal cannot close until the agency is satisfied.
“The law forbids merging firms from consummating a transaction until the companies have substantially complied with the additional investigatory request,” she wrote.