Tech war: China approves Broadcom-VMware merger with conditions, in sign of thaw with US
- The combination of the US chip maker and cloud software company is one of the biggest technology mergers ever
- The companies had been waiting for approval from China, whose regulators have tanked other large mergers in recent years
Broadcom’s US$61 billion takeover of software maker VMware won approval from Chinese regulators, albeit with a list of conditions it must fulfil.
Still, the nod from China completes the last hurdle for the companies, which said the agreement will close on Wednesday.
The combination of the US chip maker and cloud software company is one of the biggest technology mergers ever and had already received clearance from the EU, UK, South Korea and Japan. There is no legal impediment to closing in the US under merger regulations.
The conditions imposed by China are tied to how the companies sell their products in the local market, including making sure VMWare’s server software is interoperable with Broadcom’s competitors’ hardware, the regulator said in a statement on Tuesday.
China said it will approve the deal if the conditions are met and that it has the right to supervise and inspect the companies’ adherence to the restrictions.