Broadcom Acquisition of Brocade Set to Move Forward

The regulatory wheels of acquisition approvals don’t always move quickly in the U.S.; just ask Broadcom. Back in November 2016, Broadcom announced its intention to acquire Brocade in a deal valued at $5.9 billion.

On July 3, the U.S. Federal Trade Commission (FTC) announced its provisional approval of the Broadcom-Brocade acquisition, with a consent order. The order stipulated that Broadcom agrees to restrictions on access to competitively sensitive information of its customer Cisco Systems, which competes with Brocade.

“Brocade and Cisco are the only two competitors in the worldwide market for fibre channel switches, and Broadcom supplies both companies with ASICs to make fibre channel switches,” the FTC stated. “The proposed consent order, prevents Broadcom from using Cisco’s competitively sensitive confidential information for any purpose other than the design, manufacturing and sale of fibre channel ASICs for Cisco. “

Brocade also develops IP networking equipment which is competitive with multiple Broadcom customers as well. With the IP networking segment, Broadcom has already publicly stated that it wants to sell off those assets, which is a process that is already underway.

In February, Brocade announced its intention to sell its Ruckus Wireless and ICX product lines to ARRIS in a deal valued at $800 million.

In June, Brocade announced the intended sale of its virtual Application Delivery Controller (vADC) business to Pulse Secure for an undisclosed amount. Brocade had originally acquired the vADC technology from Riverbed Technology in February 2015, where it was known as SteelApp after being rebranded in 2014 from the original name Stingray.

Brocade also announced its intention to sell its Vyatta Software Defined Networking (SDN) business to AT&T in June. Brocade had originally acquired Vyatta in 2012.

Sean Michael Kerner is a senior editor at EnterpriseNetworkingPlanet and Follow him on Twitter @TechJournalist.

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