Broad­com buys busi­ness soft­ware firm CA for $18.9B

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SEMI­CON­DUC­TOR giant Broad­com, which re­cently failed in a bid to buy US ri­val Qual­comm, on Wednes­day an­nounced a cash deal to buy soft­ware and ser­vices firm CA Tech­nolo­gies for $18.9 bil­lion. Broad­com de­scribed CA as a ma­jor provider of in­for­ma­tion tech­nol­ogy man­age­ment soft­ware, in an ac­qui­si­tion that would help the chip maker di­ver­sify its of­fer­ings.

SAN FRAN­CISCO — Semi­con­duc­tor giant Broad­com, which re­cently failed in a bid to buy US ri­val Qual­comm, on Wednes­day an­nounced a cash deal to buy soft­ware and ser­vices firm CA Tech­nolo­gies for $18.9 bil­lion.

Broad­com de­scribed CA as a ma­jor provider of in­for­ma­tion tech­nol­ogy man­age­ment soft­ware, in an ac­qui­si­tion that would help the chip­maker di­ver­sify its of­fer­ings.

“This trans­ac­tion rep­re­sents an im­por­tant build­ing block as we cre­ate one of the world’s lead­ing in­fra­struc­ture tech­nol­ogy com­pa­nies,” Broad­com chief ex­ec­u­tive Hock Tan said in a re­lease.

The deal was ap­proved by the boards of both com­pa­nies.

Broad­com will pay $44.50 per share of CA stock; about 20% over the clos­ing price for com­mon shares at the end of for­mal mar­ket trad­ing on Wednes­day, ac­cord­ing to the com­pany.

“We are ex­cited to have reached this de­fin­i­tive agree­ment with Broad­com,” CA Tech­nolo­gies chief Mike Gre­goire said in the joint re­lease.

“This com­bi­na­tion aligns our ex­per­tise in soft­ware with Broad­com’s lead­er­ship in the semi­con­duc­tor in­dus­try.”

The com­pa­nies ex­pected the ac­qui­si­tion to close in the fi­nal quar­ter of this year. The merger must be ap­proved by share­hold­ers and reg­u­la­tors.

Broad­com in April trans­ferred its head­quar­ters from Sin­ga­pore to the US as promised when it tried to buy Qual­comm.

The prior month, Pres­i­dent Don­ald Trump is­sued an or­der bar­ring the pro­posed $117-bil­lion hos­tile takeover of Qual­comm, cit­ing what he called “cred­i­ble ev­i­dence” such a deal “threat­ens to im­pair the na­tional se­cu­rity of the United States.”

It would have been the biggestever deal in the tech sec­tor.

Mr. Trump’s or­der made no men­tion of China, but an ear­lier let­ter from the US Trea­sury de­part­ment warned that a takeover might hurt US lead­er­ship in 5G, su­per-fast fifth-gen­er­a­tion wire­less net­works now be­ing de­ployed, and con­se­quently pose a threat to US se­cu­rity.

The pres­i­den­tial ac­tion was al­lowed be­cause Broad­com is a for­eign en­tity, but would not have been pos­si­ble had it com­pleted its move to Sil­i­con Val­ley.

On March 14, Broad­com said it was with­draw­ing its of­fer for Qual­comm.

Broad­com was founded in Cal­i­for­nia but moved its head­quar­ters af­ter a 2015 deal that merged it with Avago Tech­nolo­gies. —

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