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Broadcom to sell workspace solutions unit to KKR for £3.1bn

Written by Tue 27 Feb 2024

Broadcome logo and motherboard - Reuters Image Credit: Reuters

Chipmaker Broadcom is set to sell its end-user computing (EUC) unit to private equity firm, KKR, for £3.1 billion ($4 billion).

The move aims to streamline Broadcom’s portfolio following its £54.4 billion ($69 billion) purchase of VMware last year. 

When finalised, the EUC unit will function as a standalone company, run by its existing management team and headed by Shankar Iyer, the Senior Vice President and General Manager of the EUC Division at Broadcom.

“We are confident that this pending transaction marks an exciting next chapter for the EUC division and one that will create enormous opportunities and benefits for our customers, partners and employees,” said Iyer.

Originally part of VMware before Broadcom’s acquisition, the EUC Division offers digital workspace solutions. These solutions enable organisations to securely deliver and manage applications, desktops, and data across any device or platform.

Key products of EUC include a desktop and application virtualisation platform, Horizon, and Unified Endpoint Management (UEM) platform for enterprises, Workspace ONE.

“EUC is a leader within large, high growth categories and demand for the business’s marquee offerings continues to grow as the workplace and the needs at the front-line evolve rapidly,” said John Park, Partner at KKR.

KKR said the EUC unit will now gain from increased access to growth capital and a dedicated focus on empowering global users and partners with innovative digital workspace solutions.

“We see great potential to grow the EUC Division by empowering this talented team and investing in product innovation, delivering excellence for customers and building strategic partnerships,” said Bradley Brown, Managing Director at KKR.

KKR’s investment is primarily through its North America Fund XIII. The transaction between Broadcom and KKR is anticipated to close in 2024, pending customary closing conditions and regulatory approvals.

Broadcom’s Acquisition of VMware

In November, Broadcom announced the completion of its acquisition of VMware.  

This acquisition reflects Broadcom’s strategy to reinforce its position in the cloud technology space. The immediate focus for Broadcom post-acquisition is to invest in and expand VMware Cloud Foundation, a cornerstone software stack for private and hybrid clouds.

Broadcom previously won approval from the UK’s Competition and Markets Authority (CMA) for its £53.6 billion ($69 billion) plan to buy VMware, overcoming another obstacle to its acquisition. This is the biggest transaction the CMA has investigated to date.

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Written by Tue 27 Feb 2024

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