London, NFAPost: The US chipmaker, Broadcom has received a nod from the European Commission for the $61-billion takeover of cloud computing firm VMware after the company offered remedies to ease competition concerns.
This deal raised concerns that it would stifle competition following its announcement in May 2022, prompting probes by antitrust watchdogs in the European Union and Britain.
According to the European Commission, its in-depth investigation found that the transaction, as originally proposed, “would harm competition in the worldwide market for the supply” of Fibre Channel Host-Bus Adapters (FC HBAs).
Part of the worries was that rivals would not be able to build components compatible with those made by VMware.
As a remedy, Broadcom offered interoperability commitments to ensure that VMware software would work with that made by rival Marvell and other potential competitors, the EU’s executive arm said.
The company also assured access to the source code for all of its current and future FC HBA drivers through an irrevocable open source licence.
The commission concluded that “the proposed acquisition, as modified by the commitments, would no longer raise competition concerns”.
Broadcom said that while it believes the deal “will only increase competition and innovation in cloud computing”, it provided a remedy “that preserves interoperability, a core principle that would not have changed as a result of this transaction”.
The transaction is expected to close in the fiscal year of 2023.
