Towards a UK green light for the Broadcom-VMware mega-merger

The British competition regulator, the CMA, has given a “provisional” green light to the acquisition for 61 billion dollars of the American software and remote computing company VMware by its compatriot, the manufacturer of semiconductors Broadcom.

The CMA has so far not found that this mega-merger “would weaken competition in the supply of critically important computing products,” the organization said in a statement.

The regulator had opened an in-depth investigation into the operation at the end of March, which had been announced in May 2022.

VMware occupies a leading position in so-called “server virtualization” software, which allows a physical server to be divided into several virtual servers.

The CMA feared that the merger “would allow Broadcom to prevent its competitors from manufacturing components compatible with VMware”, or obtain commercially sensitive information.

“The conclusions published on Wednesday are temporary” and are based on the conclusions of a panel of experts from the CMA, indicates this one. It will now seek other opinions before issuing a final decision on September 12, specifies the British regulatory authority.

The European Commission meanwhile gave the green light to the operation last week, provided that the American semiconductor manufacturer respects the corrective measures to which it has committed.