Chipmaker Broadcom (AVGO.O) is on the brink of finalising a £2.8 billion deal to offload its business enabling users to access desktops and applications from any device to private equity firm KKR (KKR.N), sources familiar with the matter disclosed on Saturday.
The potential agreement reflects an endeavour by Broadcom CEO Hock Tan to streamline the company’s portfolio post its £51 billion acquisition of software maker VMware in November.
KKR emerged victorious in the auction for the end-user computing (EUC) unit, surpassing other private equity firms, including EQT (EQTAB.ST), as per the sources.
Sources, who wished to remain anonymous due to the confidentiality of the matter, indicated that the announcement of the deal could occur as early as Monday.
KKR declined to provide comments, while Broadcom and EQT did not respond immediately to requests for comment.
Broadcom had announced in December its intention to divest its end-user computing unit while concurrently aiming to shed VMware’s security software business Carbon Black.
KKR boasts a significant track record in dealmaking within the sector.
In 2018, the firm acquired U.S. business software company BMC for £6.2 billion and subsequently merged it with Compuware two years later, a company it obtained from buyout firm Thoma Bravo.
In 2021, KKR further expanded its portfolio by acquiring information services technology provider Ensono from private equity firms Charlesbank Capital Partners and M/C Partners for approximately £1.2 billion.
Evercore, Deutsche Bank, and Jefferies are advising KKR on the transaction, whereas Citigroup is providing counsel to Broadcom, according to the sources. UBS Group, Jefferies, and KKR’s capital market unit are facilitating debt financing for the deal.