UK May Block Broadcom Takeover of VMware

Posted on Sunday, Apr 9, 2023 by Ned Bellavance

Featured in this episode of Chaos Lever

Last year Broadcom and VMware entered into a $61B acquisition agreement. In fact, we covered that news on an episode ofChaos Lever and lamented the lack of innovation and likely fate of rent extraction that VMware would be subject to.

Turns out we weren’t the only ones with concerns as the US, UK, and EU have all threatened to launch investigative panels to scrutinize the deal and its impact on consumers. Last week, the UK’s antitrust regulator made good on that threat, announcing that it would launch a deeper investigation into the proposed acquisition.

The Competition and Markets Authority is concerned about several aspects of the merger, including the possibility of Broadcom removing VMware compatibility with other hardware vendors and Broadcom’s access to privileged data vendors share with VMware to ensure compatibility.

While I don’t think either of those scenarios are likely, I do think that this delay along with expected investigations from other governments might be the death blow for this acquisition.