China is not approving, now what?
35 replies (most recent on top)
Pat G abandoned Intel’s merge with Tower because of China. Maybe we should go ask him for advice
Maybe BC should have handled China first before putting all their energy on UK.
Given all the press reports, this ends badly for AVGO as well. No matter the outcome.
I doubt a Chinese delay is simply just one month….
https://archive.ph/XGgYi
Original URL: https://www.barrons.com/articles/vmware-stock-broadcom-acquisition-china-d7cd3fcd
Quote:
In filings this week related to the acquisition, Broadcom and VMware said the deal could be affected by its ability to secure regulatory approvals on the terms expected and in a timely manner.
It looks like BC has hinted that the deal could be delayed, at least it looks like from the quote above. If so, an extension could be made public next week. Thinking logically - going ahead without Chinese approval could be complicated, would be easier to extend the date by a month and see if the situation with China could be resolved, just my $0.02.
Is China really blocking the deal? Is it over? Or just getting delayed?
Go ahead and Google Biden and Chinese chips and Intel and tower and make your own assessment
Is China really blocking the deal? Is it over? Or just getting delayed?
"Chill, its probably the top shareholders who finally got their vested RSUs"
Incorrect, the decline is being led by institutional investors (pension funds, etc.)
Comedy gold. Qualcomm Broadcom blocked by Trump and Broadcom VMware blocked because of Biden. 0-2 BC ouch.
FUBAR. This will get interesting
Jill and confirm Joe's bad timing
There is a real risk that China will find anything to retaliate against the AI Chips ban just to cause problems.
This is EXACTLY it. China was ok with the merger and were ready to approve it. Just when Biden announced the ban on chips they did a 180 and now there is a problem. This is 100% retaliation and that is a bad sign.
Can't Hock just threaten to do a compliance audit of China's IB and be done with this?
Chill, its probably the top shareholders who finally got their vested RSUs and dumping them knowing they wont be able to get the full allocation for BC shares and they rather get the current market rate than 142.50 per share. Taking money off the table when its guaranteed.
It is a real risk and the question - is Hock prepared to go down that road?
BC does over 10B in China annually so methinks no. This week is a game changer. Su-ks coz I was anticipating a severance and starting a new job. Now I have to think that one through.
I think people aren't understanding the current situation. This is a US-China trade war that is beginning and BC/VMW is caught in the middle of it.
There is a real risk that China will find anything to retaliate against the AI Chips ban just to cause problems. So yes, they can try to operate as a separate entity in China but China may find that unacceptable and say no then what is BC going to do?
It is a real risk and the question - is Hock prepared to go down that road?
Looks like the VMW share price will decline to ~$150 today, as they predicted last night
They can carve out China and let it run independently until the deal is closed.
VMW executives are already selling, in anticipation of the coming decline. Maybe they have been briefed before the market opened today -- Insider trading violation?
"EVP, Worldwide Sales Jean Brulard Sells 4,966 Shares of VMware Inc"
There is an argument to be made that BC will not want to cause problems with it's current business in China.
If BC goes forward with the deal without Chinese approval it will certainly pi-s them off... then they can simply claim BC owns VMware portfolio and cannot do business in China. Then BC will be absolutely screwed. Hock is no way going to risk that.
The ignorance of some people. China’s revenue for Broadcom is 1/3 its revenues. Broadcom cannot afford to pi-s off China.
"This is silly. The deal will close and they will regret it, this is based on irrational panic."
I'm not going to risk it. I'm unloading my RSUs before the VMW stock tanks like Intel
Wall Street analysts have already predicted a run on the VMW stock as investors unload their shares before it declines rapidly in the coming week. What a nightmare!
This is silly. The deal will close and they will regret it, this is based on irrational panic. BC will close the deal on Oct 30 without China, it isn't a big deal. They have already planned contingencies around this as Hock indicated in an indirect way during the meeting "Lack of China approval is not a problem"
Wall Street analysts have already predicted a run on the VMW stock as investors unload their shares before it declines rapidly in the coming week. What a nightmare!
"It would totally su-k for anyone holding VMware stock because if the deal falls through, it would likely crater."
Exactly why I recently sold most of my RSUs at the recent VMW market peak price.
"Chinese officials have been closely scrutinizing any transaction involving US chip groups. Semiconductor giant Intel in August called off its $5.4bn acquisition of Israeli chipmaker Tower Semiconductor, after failing to secure regulatory approval in China ahead of a self-imposed deadline for closing the transaction."
Note, there is a track record of Chinese regulators blocking these types of deals.
This is is one of the more insightful articles
https://www.ft.com/content/b23d2a9f-d873-43e4-9032-632d4e9d438c?ftcamp=traffic/partner/feed_headline/us_yahoo/auddev
It can delay forever. Check the old news Qualcomm wants to buy nxp
OP - there is nothing out there that said China is not approving. All media said a potential delay.
Yayyyyy no deal,, DEI is saved so as for EuC
It would totally su-k for anyone holding VMware stock because if the deal falls through, it would likely crater. Like to at least $80…
Dear god, please let China block the deal, it would be so fu--ing funny.
Focus on the main thing.
Layoffs cancelled. PARRYYYY ….
Now you keep updating your resume because nothing has changed.