Avago-Broadcom deal to create networking, IoT chip giant

Avago-Broadcom deal to create networking, IoT chip giant

By eeNews Europe

Broadcom is the industry’s biggest maker of Wi-Fi chips that provide short-range wireless connections for mobile and connected devices, while Avago manufactures a broad range of products, including optical components, aimed at wireless communications, enterprise storage, wired infrastructure, and industrial markets. The deal will create the world’s sixth-largest chipmaker by revenue, and is almost twice the size of the previously announced NXP Semiconductors’ planned purchase of Freescale Semiconductors.

Avago is offering $17 billion of cash and $20 billion in stock to aquire Broadcom, valuing the latter at $54.50 a share. In a statement, the companies said that the combined company would have "the most diversified communications platform in the semiconductor industry, with combined annual revenues of approximately $15 billion."

"Today’s announcement marks the combination of the unparalleled engineering prowess of Broadcom with Avago’s heritage of technology from HP, AT&T, and LSI Logic, in a landmark transaction for the semiconductor industry," said Hock Tan, President and Chief Executive Officer of Avago. "The combination of Avago and Broadcom creates a global diversified leader in wired and wireless communication semiconductors."

When the transaction is complete, Tan will continue to serve as as President and Chief Executive Officer of the combined company, which will be known as Broadcom Limited. The deal is expected to close by the end of the first quarter of 2016. It will require approvals by both regulators and shareholders.

Avago Technologies:
Broadcom Corp.:

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