The UK’s Competition and Markets Authority (CMA) has decided to refer Broadcom’s purchase of VMware, agreed a year ago for about $61 billion (€56.75 billion), to an in-depth investigation over the risk that it will result in a »substantial lessening of competition» in the country and after Broadcom declined to offer commitments to alleviate the regulator’s concerns.
»The CMA has referred Broadcom’s planned acquisition of VMware for an in-depth investigation on the basis that, based on the information currently available, it is or may be the case that this Merger would be expected to result in a substantial lessening of competition within a market or markets in the UK,» the UK regulator announced Wednesday.
Last December, the European Commission announced an in-depth investigation into whether Broadcom’s purchase of VMware could harm the industry by restricting competition in the market for certain components that are interoperable with VMware software.
The UK Authority had already warned last week, following a preliminary investigation, of its concerns regarding the competitive impact of the transaction, warning that it would open an in-depth investigation if the parties did not offer commitments that would alleviate such concerns.
In this regard, the regulator has reported that »on March 22, 2023, Broadcom informed the CMA that it would not offer such commitments,» following which the CMA has decided to refer the case to its chairman with a view to the formation of a panel to conduct a »Phase 2 investigation» under the Regulatory Reform and Enterprise Act of 2013.
US integrated circuit maker Broadcom reached an agreement in May 2022 to acquire cloud software company VMware for $61 billion in cash and stock, in addition to assuming a further $8 billion (€7.442 billion) in company debt.
Source: (EUROPA PRESS)
