Chipmaker Broadcom Inc is in talks to acquire cloud service provider VMware Inc, people familiar with the matter told Reuters.
Negotiations between Broadcom and VMware are ongoing and a deal is not imminent, the sources said. The deal terms under discussion could not be learned.
The acquisition would further diversify Broadcom’s business from semiconductors to enterprise software, following the $18.9 billion acquisition of CA Technologies and the $10.7 billion purchase of Symantec Corp.’s security division over the past four years.
Bloomberg News first reported the deal late Sunday. Broadcom and VMware did not immediately respond to Reuters’ requests for comment. At market close on Friday, VMware’s market cap was $40.3 billion.
Michael Dell is VMware’s largest investor with a 40% stake as a result of Dell Technologies Inc transferring VMWare to its shareholders last year, according to data from Refinitiv.
Private equity firm Silver Lake, which has previously invested in Broadcom, is VMware’s second largest shareholder with a 10% stake, data from Refinitiv shows.
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