Advertisement

Blog

Avago-Broadcom Deal: What’s in It for You?

One of the fascinating features of capitalism is that money talks.

For example, I can’t help but see Avago’s eye-popping $37 billion acquisition of Broadcom as an outspoken case of Wall Street winning huge over the engineering community.

The deal was done on behalf of the two companies’ shareholders. Nothing wrong with that. It’s textbook (well, Milton Friedman’s textbook) capitalism.

But here’s the rub. I can’t see any imperative reason that Broadcom had to be gobbled up by a smaller company. Avago had about $4.3 billion in revenues in the last fiscal year, while Broadcom made almost double that amount. Picture a salmon swallowing a shark.

It isn’t like Broadcom was in dire straits, fighting for survival.  Far from it.

Of course, “little overlap” in products and “synergy” in business are two key words every company often uses to justify a proposed M&A.

Avago’s Broadcom acquisition obviously fits the cliché.

As my colleague Rick Merritt pointed out in his story, “Avago is strong in analog products related to optical and wireless communications. Broadcom is more focused on digital SoCs for smart home and data center markets.”

Combining the two businesses will make the merged entity big. That’s for sure.

But I need to be enlightened on how this advances the companies’ technologies. How will this deal make it better for engineers at the two companies working on new products and technologies? Am I cynical in suspecting that Avago wanted Broadcom purely for the sake of getting bigger?

Where is the affinity – or any apparent good vibe – connecting Avago to Broadcom? Aren’t the “soft” factors of corporate culture at least as important for successful mergers as a momentary splash on the stock market?

To read the rest of this article, visit EBN sister site EE Times.

.

2 comments on “Avago-Broadcom Deal: What’s in It for You?

  1. shivani336
    December 6, 2016

    good with no USB. you could also send your Smartphone or Tablet SHAREit for PC After click the Download web link you will certainly show a popup box. nice.

  2. Alonzo77
    June 20, 2017

    Adhere to these easy actions to download Tutu app for iOS gadgets. tutuapp android Click on Tutu app file as well as mount it on your tool.currently you have mounted.

Leave a Reply

This site uses Akismet to reduce spam. Learn how your comment data is processed.