$3.8B Deal: Broadcom to Sell Remote Access Business

On February 24, insider sources revealed that Broadcom, a prominent chip manufacturer, is on the brink of finalizing a substantial $3.8 billion transaction. The deal involves the divestiture of its business focused on remote access, enabling users to seamlessly access desktops and applications from any device. The recipient of this strategic business unit is the private equity firm KKR.

This impending transaction symbolizes the proactive measures taken by Broadcom's CEO, Hock Tan, to refine the company's investment portfolio following the successful completion of the $69 billion acquisition of software giant VMware in November 2023.

Insiders indicate that KKR emerged victorious in a competitive bidding process for Broadcom's End-User Computing (EUC) division, surpassing other contenders, including EQT. The official announcement of this transaction is anticipated as early as February 26.

Advisory services for KKR are being provided by Evercore, Deutsche Bank, and Jefferies, while Citigroup is serving as the advisor to Broadcom. UBS Group, Jefferies, and KKR's capital markets division are set to facilitate debt financing for the transaction.

It was disclosed in December 2023 that Broadcom had intentions to divest its End-User Computing division. Furthermore, the company is actively exploring the separation of Carbon Black, the security software business within VMware.

KKR's involvement in the software industry is noteworthy, with the acquisition of US business software company BMC for $8.5 billion in 2018. Subsequently, KKR orchestrated the merger of BMC with Compuware, acquired from Thoma Bravo. In 2021, KKR successfully secured information services technology provider Ensono for approximately $1.7 billion from private equity firms Charlesbank Capital Partners and M/C Partners.