Chip maker Broadcom Inc. is in negotiations to buy enterprise cloud-computing company VMware Inc., according to multiple reports Sunday night.
Bloomberg News, Reuters and the New York Times reported the ongoing talks but did not mention a purchase price; as of Friday, VMware
had a market cap of about $40.3 billion, while Broadcom was valued at about $222 billion.
The reports said said talks are ongoing, and it’s possible no deal will be reached.
San Jose, Calif.-based Broadcom
has reportedly been seeking a major software acquisition for some time; its last major deal was the nearly $11 billion purchase of Symantec Corp.’s enterprise security business in 2019.
“M&A has played a central role in Broadcom’s growth strategy and this transaction represents the next logical step in our strategy,” Broadcom Chief Executive Hock Tan said at the time.
Broadcom topped Wall Street’s estimates when it reported fiscal first-quarter earnings in March. The company is scheduled to report second-quarter earnings June 2.
In its last earnings report in February, Palo Alto, Calif.-based VMware beat earnings expectations but lowered its outlook for the current quarter. It is scheduled to report first-quarter earnings on Thursday.
Broadcom shares are down 18% year to date, while VMware is down 17%, roughly in line with the S&P 500’s
18% decline this year.