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KKR to acquire VMware's end user computing biz from Broadcom for $4B

TechCrunch · 1y ago

KKR to acquire VMware's end user computing biz from Broadcom for $4B

Private equity firm KKR has announced its acquisition of Broadcom's end user computing business for $4 billion. This deal comes as part of Broadcom's efforts to recoup some of the costs from its $61 billion acquisition of VMware. KKR plans to build out the end user computing division into a standalone business, with potential for growth in product innovation and strategic partnerships. Notably, KKR intends to implement an employee ownership program, allowing employees to own equity in the new company. This marks the fifth multi-billion dollar deal of the year, following other major acquisitions in the tech industry.

Related News

Broadcom is selling even more VMware assets — end-compute unit set for billion-dollar deal

Techradar

Techradar · 1y ago

Broadcom is selling even more VMware assets — end-compute unit set for billion-dollar deal

Broadcom is reportedly selling off its End-User Compute (EUC) arm of VMware to private equity firm KKR for $3.8 billion. Since Broadcom acquired VMware in 2023, it has made controversial changes to the cloud computing service, including terminating perpetual licenses and axing the free ESXi Hypervisor. These changes have led to rising costs for customers, with some bills increasing by staggering amounts. The sale of the EUC sector follows Broadcom's announcement in December 2023 of its intentions to sell that part of the business. The move will likely impact VMware's government and regulated industry clientele.

Broadcom nears $3.8 billion sale of remote access unit to KKR

Economic Times

Economic Times · 1y ago

Broadcom nears $3.8 billion sale of remote access unit to KKR

Broadcom is reportedly close to finalizing a $3.8 billion deal to sell its end-user computing (EUC) unit to private equity firm KKR. This move follows Broadcom's recent takeover of software maker VMware in an effort to streamline its portfolio. KKR emerged as the top bidder for the EUC unit over other private equity firms. The deal is expected to be announced soon, with Evercore, Deutsche Bank, and Jefferies advising KKR and Citigroup advising Broadcom. KKR has a history of dealmaking in the tech sector, including its previous acquisitions of BMC and Ensono.

Chipmaker Broadcom sells remote access unit to KKR in $4 billion deal

Reuters · 1y ago

Chipmaker Broadcom sells remote access unit to KKR in $4 billion deal

Broadcom has announced the sale of its end-user computing (EUC) business, which provides access to desktops and applications from any device, to private equity firm KKR for $4 billion. The EUC unit will continue to be managed by its current leadership team, led by Shankar Iyer. KKR emerged as the winner in an auction for the business, beating other private equity firms like EQT. The deal is set to further strengthen KKR's position in the technology sector.

Broadcom killing VMware partner program could disrupt thousands of businesses

Arstechnica

Arstechnica · 1y ago

Broadcom killing VMware partner program could disrupt thousands of businesses

Broadcom, the new owner of VMware, is ending the partner programs of the virtualization and cloud computing company. From April 30, 2024, VMware's partnership with solution providers, resellers, and distributors will come to an end, potentially disrupting tens of thousands of businesses. The lack of clarity from Broadcom about who will be invited to its partner program has caused uncertainty among VMware partners and customers. There are concerns that only a small percentage of cloud service providers will be invited, leaving many without access to VMware.

Broadcom reverses controversial plan in effort to cull VMware migrations

Arstechnica

Arstechnica · 8m ago

Broadcom reverses controversial plan in effort to cull VMware migrations

Broadcom is changing its strategy with VMware, no longer dealing directly with the biggest 2,000 customers, but instead collaborating with VMware's top 500 customers. This shift is aimed at discouraging migrations from VMware. However, customers have voiced concerns over Broadcom's previous controversial changes, including ending perpetual license sales and VMware's channel partner program. Broadcom hopes to mitigate this by involving channel partners in deals and providing additional value for customers. The move is an attempt to retain business and promote the implementation of Broadcom's private cloud bundles.

Apple cancels its car, Google's AI goes awry and Bumble stumbles

TechCrunch · 1y ago

In this week's tech industry news, investment firm KKR is acquiring VMware's end-user computing business for $4 billion. French AI startup Mistral has launched a new model to rival OpenAI's GPT-4, alongside a partnership with Microsoft. Apple has canceled its secretive autonomous electric car project, while Bumble posted weak Q4 results and plans to lay off 30% of its workforce. Google apologized for an AI blunder, Tumblr's CEO faced criticism, and Byju's investors voted to remove the company's founder. Inkitt, a self-publishing platform, raised $37 million, and Lapse secured $30 million for its unique photo-sharing app. Techstars faced criticism after operational changes, and various podcasts covered startup news and interviews. Toyota is offering a steep discount on its Mirai fuel-cell vehicle.

Broadcom cuts at least 2,800 VMware jobs following $69 billion acquisition

Arstechnica

Arstechnica · 1y ago

Broadcom cuts at least 2,800 VMware jobs following $69 billion acquisition

Broadcom has completed its $69 billion acquisition of VMware and is implementing layoffs. At least 2,837 employees across multiple states will be affected, with 1,267 job cuts at the Palo Alto campus in California. WARN notices filed by Broadcom cite "economic" reasons for the layoffs, but no further explanation was provided. Despite the layoffs, VMware will continue to play a significant role in Broadcom's enterprise software strategy, with plans to focus on software subscriptions for revenue growth. Details of the Broadcom-owned VMware's future remain unclear.

VMware by Broadcom is overhauling its training for an all-new experience

Techradar

Techradar · 1y ago

VMware by Broadcom is overhauling its training for an all-new experience

Broadcom is overhauling its training experience for VMware, aiming to offer more training at a lower cost. The company recently made its digital content library, including on-demand courseware, free for VMware Cloud Foundation customers, strategic customer segment, and Broadcom Advantage program partners. The move is seen as a strategic approach to attract more customers and ease the financial burden of adopting Cloud Foundation. However, access to the revamped training for the broader VMware community is yet to be confirmed. Despite some pushback, Broadcom CEO Hock Tan expects double-digit growth to boost VMware's profitability after the company's acquisition.

OpenStack improves support for AI workloads

TechCrunch · 1y ago

OpenStack improves support for AI workloads

The OpenInfra Foundation has launched version 29 of OpenStack, an open-source project that enables businesses to manage private clouds on-premises. Called 'Caracal', this new release focuses on AI and high-performance computing workloads. OpenStack is emerging as a comprehensive alternative to VMware's offerings, particularly as some VMware users are seeking alternatives following its sale to Broadcom. OpenStack has seen growth in the Asia-Pacific region, while Europe, with its strong data sovereignty laws, has become a growth market. This release includes new features such as vGPU live migrations and security enhancements.

Broadcom ends business with VMware’s lowest-tier channel partners

Arstechnica

Arstechnica · 2m ago

Broadcom ends business with VMware’s lowest-tier channel partners

Broadcom is ending its business with VMware's lowest-tier partners, dismissing the Registered tier in its VMware partner program. This decision aims to focus on top-tier partners with stronger customer engagement and historical performance. This move has faced criticism for potentially increasing costs and reducing competition while forcing smaller partners, like Canadian MSP Members IT Group, to seek alternatives. Broadcom plans to enhance partner relationships through stringent standards, potentially alienating existing partners and driving them to competitors.

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