Broadcom said Thursday that it will buy cloud service provider VMware in a cash-and-equity deal worth $61 billion (about Rs 4,73,223 crore) to further diversify the chip maker’s business into enterprise software.

Broadcom shares are up 1.6%, while VMWare shares are down nearly 1% in premarket trading.

The acquisition is the second largest announced globally so far this year, following Microsoft’s $68.7 billion (about Rs 5,32,955 crore) deal to buy video game company Activision Blizzard in January.

Each VMware shareholder will receive $142.50 (about 11,000 rupees) per share, resulting in a premium of more than 48 percent over closing the share since deal talks were first announced on May 22.

VMware shareholders will receive $142.50 in cash or 0.2520 shares of Broadcom common stock for each VMware stock.

© Thomson Reuters 2022