Broadcom Limited and Brocade Communications Systems, Inc. have entered into a definitive agreement under which Broadcom will acquire Brocade, a vendor in the Fibre Channel storage area network switching and IP networking space, in an all-cash transaction valued at approximately $5.5 billion, plus $0.4 billion of net debt, for a total of $5.9 billion.
Broadcom says the strategic acquisition strengthens its portfolio of enterprise storage and networking solutions serving OEM customers.
Broadcom plans to retain Brocade’s Fibre Channel SAN switching business and divest Brocade’s IP networking business, consisting of wireless and campus networking, data center switching and routing, and software networking solutions, including the recently acquired Ruckus Wireless.
The acquisition will enhance Broadcom’s position as one of the leading providers of enterprise storage connectivity solutions to OEM customers, according to Hock Tan, president and CEO of Broadcom. With its experience in mission-critical storage networking, Brocade will increase Broadcom’s ability to address the evolving needs of these OEM customers, he added.
The deal is expected to close in the second half of Broadcom’s fiscal year 2017 which began on October 31, 2016.
For more information, go to www.broadcom.com