March 31, 2023
Timothy LaComb, a San Diego-based attorney who specializes in antitrust, unfair competition, and complex business cases, believes that the proposed $61 billion merger between Broadcom and VMware may not go through because to the UK’s extensive examination into potential antitrust problems. According to LaComb, over 60% of acquisitions undergoing comparable probes since 2019 did not go through.
Following regulatory concerns expressed last week, the British Competition and Markets Authority (CMA) launched a Phase 2 inquiry into the Broadcom-VMware deal. The CMA is worried that this merger may reduce competition in the UK market for certain goods and services such as Ethernet network interface cards, storage adapters, fiber channel host-bus adapters, and fiber channel switches.
According to the CMA study, Broadcom’s competitors in the server hardware sector may suffer as a result of the merger since it reduces interoperability with VMware’s dominant server virtualization software, making it more difficult for them to acquire certification for their gear. The CMA is also concerned that Broadcom may get commercially sensitive information from competitors seeking VMware interoperability certification. In the United States, the Federal Trade Commission (FTC) is conducting its own extensive assessment and may reject the merger, significantly reducing the likelihood of completion.
Broadcom and VMware have said that the transaction will be completed in Broadcom’s fiscal year 2023. In addition to the FTCs in the United Kingdom and the United States, the EU announced its own inquiry into the merger in December.
The sources for this piece include an article in Silverliningsinfo.
