Broadcom has confirmed plans to sell VMware's end-user computing (EUC) division to global investment firm Kohlberg Kravis Roberts & Co (KKR) as part of a $4 billion deal.
Under the terms of the agreement, the EUC Division, which was originally a branch of VMware before Acquisition of the company by Broadcom in November 2023It will now become an independent company.
KKR confirmed that the unit will now have “greater access to growth capital and a dedicated strategic focus”, allowing for further development of the business.
The EUC Division will continue under its current management team, although KKR is looking to expand research and development capabilities as well as pursue “new strategic partnerships.”
Broadcom's decision to sell the platform marks a significant step as this segment led the way in terms of digital workspace offerings. Through a variety of products, the division enables organizations to securely deliver and manage remote work systems.
Its key products include Horizon, a desktop and application virtualization platform, and Workspace ONE, a unified endpoint management (UEM) platform designed for enterprise-level use.
“We see great potential to grow the EUC Division by empowering this talented team and investing in product innovation, delivering excellence to customers and creating strategic partnerships,” said Bradley Brown, CEO of KKR.
Shankar Iyer, senior vice president and general manager of the end-user computing division, will remain following the deal. Iyer described KKR as an “ideal new strategic partner” for the unit.
“They are one of the most active investors focused on building world-leading technology companies,” he said. “Most importantly, KKR believes in the unique value our technology delivers to our broad and loyal customer base, and they are eager to invest in our mission to become an even more innovative and customer-centric organization.”
VMware is not having a good time
Broadcom's move is part of a consistent pattern since its acquisition of VMware in late 2023.
Broadcom first announced plans to acquire the technology company in 2022 as part of a $69 billion deal, which ultimately won regulatory approval in November 2023.
Since then, the floodgates have opened and Broadcom has introduced radical changes to a range of products and the way customers interact with the company.
Perpetual licenses, for example, were among the first major changes revealed by Broadcom. In December, the firm confirmed plans to cut VMware perpetual licenses as part of what he described as a “simplification” of VMware’s product portfolio.
This has since been followed by a series of other product and service cuts. January saw VMware's Aria SaaS offering becomes the latest victim of Broadcom's relentless campaign of product “simplification.”
At that time, more than 50 independent cloud services were confirmed for the chopping block and the number has been growing ever since.
