What is stopping Broadcom from keeping its business in China exactly as it is now, and chopping off the VMware parts in China? Wouldn't that take China out of the picture for the acquisition merger because now VMware in China is no longer acquired?
If that is the case, then maybe that is the plan B and the delay is due to writing up new papers that exclude the parts of VMware that are in China. With the long term view to maybe pick it up later.
Reading an M&A specialist (on another topic) and he said that recently China changed the approval process to prevent the separate entity work around. Essentially if a company goes ahead without approval they can be fined up to 10% of their global profit the previous year. They can also shut the company out of the China market. That’s a giant hit to BC which does a lot of business in China.
My guess is that this probably will close. But that’s based on Hoc’s vehement insistence it will and past experience with people from cultures where “face” is very important. On the other hand, China may decide to flex its economic muscle to “punish” the U.S. for AI chip restrictions. Personally I’m leaning towards a delayed close, but who knows.
There's no scenario today where BC in China and VMware in China can be run separately while they move forward with closing the aquisition. BC needs China regulatory permission to operate and to give the green light to this deal. If they don't, then BC will not aquire VMware. There's no loophole in which they can close the deal without Chinas approval. BC isn't more special than Intel and Qualcomm. Everything reported on without Chinas approval means nothing. It's all psuedo legalize language so they don't get sued by investors or the government. Companies by now shouldn't even bother acquiring another company without China's approval if they care about that revenue stream now or in the future. News flash, China accounts for a lot of our top companies revenue. No company can risk decoupling from that revenue source without facing legal and financial consequences.
I think BC will be split up into dozens of smaller companies. My astrologist told me so, so it must be true.
Can we stop with this BS? It's proven to be delusional misinformation
Does HT need to care about how VMware China would operate? Would Micheal Dell care with his payday? What stops them from chalking it up to "cost of doing business"? I don't know if Chinese law has protections to stop that. It might help achieve layoff numbers and not be all that bad in their view.
Dream on. VMware China can't operate alone. How would they do that? Do you think that HT will fund them having HR and Finance and all of the overhead?
If this decision was made, hock would have to go back to Michael and renegotiate the deal without China. He won't do that. He won't pay 69bn for a company that does not include China.that would be ridiculous.
could very well be the case. You might be onto something here