Talks between Broadcom and software company SAS Institutes have hit a dead end. According to people familiar with the development, the deal would have valued the North Carolina-based company at USD 15 billion to USD 20 billion. The person said that talks collapsed after the matter became public. The acquisition would have helped Broadcom to expand into the software industry. Broadcom Chief Executive Officer Hock Tan has been trying to make several deals in order to transform his company. The company acquired CA Technologies in the year 2018 and American software company Symantec in 2019. It won’t be wrong to say that the company is largely built through acquisition. It was on the lookout for more deals. However, it has failed to finalize any.
The focus on software is even justified as it generated 27 per cent of the total revenue of the Broadcom in the quarter that ended. These acquisitions were initially not liked by investors. However, they have now reduced the company’s dependency on semiconductors for sales. The deal to acquire SAS was aimed at reducing the dependency further. SAS was established in 1976 by Jim Goodnight and John Sall. The company is in the business of software management and analytics. Goodnight is currently on the list of the top 50 wealthiest people in the United States. According to a report, Goodnight worked as a statistics professor at North Carolina State University when he started SAS.
Before the coronavirus pandemic struck, SAS was profitable for around 44 years. More than 83,000 businesses, government office,s and universities used analytic platforms provided by the company. Commenting on the deal, the SAC founder said that “the company is not for sale. In a message, sent to all the employees, Goodnight said that the company is doing great and is focused on further innovation. While Broadcom has become a powerhouse with a string of acquisitions, SAS too wants to become the leader in the field of software.