Broadcom stock rises to a record after $4 billion deal to sell its EUC Division
By Tomi Kilgore
Investment firm KKR to buy the End-User Computing Division, and will implement its employee ownership program after deal closes
Shares of Broadcom Inc. rallied into record territory Monday, after the semiconductor and software company agreed to sell its End-User Computing Division to KKR & Co. Inc. in a deal valued at $4 billion.
Broadcom's stock (AVGO) climbed 1% on Monday and closed at $1,309.13, topping its Feb. 22 previous record close of $1,304.90.
The stock's rally has lifted Broadcom's market capitalization to $613.8 billion, which makes the company the 10th-most valuable in the S&P 500 index SPX, just behind ninth-place Tesla Inc. (TSLA) at $632.9 billion.
KKR shares (KKR) traded flat Monday.
The EUC Division was originally part of VMware, which Broadcom acquired in a deal that closed in November 2023. The division provides digital workspace offerings that allows businesses to manage desktops and data across any platform.
"We are confident that this pending transaction marks an exciting next chapter for the EUC Division and one that will create enormous opportunities and benefits for our customers, partners and employees," said Shankar Iyer, general manager of the EUC Division.
The deal is expected to close later this year, after which the division will continue to operate as a standalone company, run by its existing management team.
The division will also implement KKR's employee-ownership program, which helps motivate employees because it makes them owners in their businesses.
Broadcom's stock has soared 34% over the past three months, while the S&P 500 SPX has gained 11.3%.
-Tomi Kilgore
This content was created by MarketWatch, which is operated by Dow Jones & Co. MarketWatch is published independently from Dow Jones Newswires and The Wall Street Journal.
(END) Dow Jones Newswires
02-26-24 1625ET
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