decor decor
"Timing has always been a key element in my life."

-Buzz Aldrin

Broadcom Nears Deal to Acquire CA Technologies for Nearly $19B

martinwolf Transaction Analysis
Financial Information*
  • Enterprise Value                                        ~$18.9B
  • EV/LTM Revenue                                         4.5x
  • EV/LTM EBITDA                                           12.4x
Transaction Facts
  • According to sources cited by the Wall Street Journal and Bloomberg, semiconductor giant Broadcom (Nasdaq: AVGO) is acquiring software vendor CA Technologies (Nasdaq: CA) for $44.50 per share — or a total of nearly $19B. The deal could be announced as early as later today.
  • CA Technologies stock soared more than 16 percent in after-hours trading following the news, while Broadcom shares fell about 5 percent during the same time.
A New Direction
  • Moving Forward: After President Trump blocked Broadcom’s efforts to acquire Qualcomm in a $103B hostile takeover just four months ago, the $108B giant wasted no time in expanding its acquisition list and paving the path for smoother acquisitions in the future. Moving its corporate headquarters from Singapore to the US (San Jose, California) this year should exempt it from needing approval from the Committee on Foreign Investment in the United States (Cfius), the inter-agency government that blocked its earlier bid. 
  • Changing Strategy: Broadcom, which is down more than 5 percent year-to-date, could help diversify its assets through the CA deal by adding cloud-based and traditional enterprise software capabilities. The company has usually stuck to purchases in the semiconductor space in the past, but it’s expanding to include newer offerings, as exemplified by its acquisition of Brocade Communications for $5.9B last November.
For more information about this transaction, click here to read the report.
 
*Financial information from the press release.
martinwolf was not the advisor in this transaction.
previous post Back to Articles next post

31 Jan 2023

Rising Interest Rates Chill Private Equity Pace

After a year of strength on the private equity front, 2022 is now in the rearview mirror and industry professionals anticipate a downgrade in performance for the coming year.   Despite the fluctuations of the past few years, private equity has withstood the challenges relatively well. However, in certain areas such as exit activity and...

18 Jan 2023

IT Industry Titan John McKenna Announces Retirement 

Congratulations to John McKenna, CEO of ConvergeOne, who announced his retirement today after 14 years at the helm. John has been an integral part of the IT industry for more than 30 years, and his leadership, dedication, and hard work have set the gold standard as a titan in our industry.   John’s tenure at...

21 Dec 2022

Happy Holidays – The 2022 martinwolf Annual Letter

View a pdf of this letter here.    Dear Clients, Partners, and Friends, It’s hard to believe we are closing the books on our 25th year in business. Looking back at our extraordinary colleagues past and present, hundreds of clients, and a global network of buyers and friends, I want to start this year’s letter...