8-KAcquisitions & DispositionsFinancial EventsOther Events+1

Broadcom Inc. 8-K Report, Acquisition Completed (Nov 22, 2023)

Filed November 22, 2023For Securities:AVGO

Summary

Broadcom Inc. (AVGO) has officially completed its acquisition of VMware, Inc. as of November 22, 2023. This landmark transaction, initially announced in May 2022, marks a significant strategic move for Broadcom, aiming to expand its software portfolio and create a more diversified technology powerhouse. The acquisition was structured through a series of mergers, culminating in VMware becoming a wholly owned subsidiary of Broadcom. Investors should note that the cash and stock consideration for VMware shareholders was subject to proration, with 50% of shares receiving cash and 50% receiving Broadcom stock. Broadcom financed a substantial portion of the cash component through a significant debt issuance, borrowing the full $28.39 billion available under its senior unsecured term loan credit agreement. This report also indicates that detailed financial statements and pro forma information for the acquired VMware business will be filed in a subsequent amendment, which is crucial for a full understanding of the combined entity's financial picture.

Key Highlights

  • 1Completion of the acquisition of VMware, Inc. by Broadcom Inc. on November 22, 2023.
  • 2The transaction was structured as a multi-step merger, making VMware a wholly owned subsidiary of Broadcom.
  • 3VMware shareholders received a mix of $142.50 in cash and 0.25200 shares of Broadcom common stock per share, subject to proration.
  • 4Broadcom funded the cash portion of the acquisition through a $28.39 billion borrowing under its senior unsecured term loan credit agreement.
  • 5The filing incorporates by reference the merger agreement and the credit agreement, along with related exhibits.
  • 6Financial statements and pro forma information for VMware will be filed via amendment within 71 days.
  • 7The report includes standard cautionary statements regarding forward-looking statements and associated risks and uncertainties.

Frequently Asked Questions

This 8-K filing serves to officially announce the completion of Broadcom Inc.'s acquisition of VMware, Inc., detailing the event date and the structure of the transaction, including the merger process and consideration paid to VMware shareholders.

Broadcom financed the cash component of the acquisition through a combination of cash on hand and significant borrowings. Specifically, Broadcom borrowed the full $28.39 billion available under its senior unsecured term loan credit agreement, which was used to fund the cash consideration, provide working capital, refinance existing VMware debt, and cover associated costs.

VMware shareholders received a combination of cash and Broadcom common stock. The consideration per VMware common share was $142.50 in cash or 0.25200 shares of Broadcom common stock, at the election of the holder. This was subject to proration, ensuring that approximately 50% of all VMware shares received cash and 50% received stock.

The filing states that financial statements of the acquired business (VMware) and pro forma financial information for the combined entity will be filed by amendment to this Current Report on Form 8-K no later than 71 days following the filing date of this report.