EU Judges to Review Broadcom’s Acquisition of VMWare
European Union judges are set to evaluate chipmaker Broadcom’s $69 billion purchase of cloud computing firm VMWare following an antitrust complaint challenging the bloc’s approval of the tech industry’s major takeover.
The Cloud Infrastructure Services Providers in Europe (CISPE) has lodged a formal appeal with the European General Court, aiming to annul the European Commission’s endorsement of the transaction, announced on Thursday.
Broadcom finalized the acquisition of VMWare in November 2023, which faced repeated delays due to stringent global regulatory scrutiny.
The European Commission’s official summary, released in May, admitted the substantial competition risks posed by the acquisition.
Despite this, CISPE criticized the Commission for not imposing any conditions on Broadcom to prevent market dominance or manage potential abuse.
CISPE has continuously informed the Commission about Broadcom’s unjust software licensing practices but no decisive measures have been taken to assist European cloud service providers or their clients.
Francisco Mingorance, CISPE’s Secretary General, highlighted that VMware’s software dominance in the virtualization industry enables Broadcom’s unfair licensing terms to impact nearly every European organization utilizing cloud services.
Responding to the allegations, a European Commission spokesperson stated readiness to defend their decisions in court. In contrast, Broadcom’s representative denied the claims, asserting that the deal went through a meticulous merger review process with commitments to the Commission.
The acquisition, announced as one of the largest globally in May 2022, formed part of Broadcom CEO Hock Tan’s endeavors to enhance the chipmaker’s software division.
