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Broadcom powerhouse Krause sets his exitBroadcom powerhouse Krause sets his exit

Broadcom President Thomas Krause is leaving the chipmaker just a few weeks after it announced it would buy VMware for $61 billion, a deal he helped put together.

2 Min Read
Broadcom powerhouse Krause sets his exit

One of the primary Broadcom executives responsible for leading talks about the $61 billion acquisition of VMware has resigned, according to Bloomberg News.

Broadcom President Thomas Krause's resignation will be effective on July 15. He leaves for a new position with an unnamed privately held enterprise software company, said Bloomberg.

Krause's position will be eliminated and CEO Hock Tan will absorb his job responsibilities, reported The Wall Street Journal (WSJ).

Krause's departure comes at an inopportune time for Broadcom as the semiconductor company "attempts to close one of the biggest technology deals in history," said Bloomberg. However, his resignation isn't a result of a disagreement with Broadcom or management, or related to company performance, according to Bloomberg and WSJ.

In coordination with CEO Tan, Krause was "one of the chief negotiators" in discussions to acquire VMware for $61 billion, said Bloomberg. Krause became CFO of Broadcom in 2016 and has headed the chipmaker's six software divisions since 2020.

Investors and customers are among those starting to gnaw their fingernails over the possible deal, expressing concern about Broadcom's history of absorbing other software companies.

"As regulators mull the implications, VMware investors, employees and customers fear Broadcom will mess up the formula," reported Light Reading's Iain Morris earlier this month. "Its track record on takeovers of software companies is marked by layoffs and R&D cutbacks, say critics. Speculation alone could prompt customers to look elsewhere."

Customers of both companies are concerned about the potential deal, according to a recent S&P Global Market Intelligence survey. About 56% of Broadcom and/or VMware customers said they felt negatively about the deal. Customers' primary concern is that "innovation would suffer, synergies would be elusive and software licensing terms might become less favorable," wrote Morris.

Since the deal was announced in May, VMware's share price is down 14%, and since its high point in April 2019, the stock has dropped 44%, added Morris.

The VMware deal is one of the largest in recent history for the technology space. It ranks among Dell's purchase of EMC (VMware's former owner) for $67 billion in 2015, and Microsoft's $68.7 billion bid for video game company Activision Blizzard, reported Light Reading's Mike Dano. He notes that Dell completed a VMware spinoff last November.

— Kelsey Kusterer Ziser, Senior Editor, Light Reading

About the Author(s)

Kelsey Kusterer Ziser


Kelsey Kusterer Ziser studied journalism and mass communication with a second major of Spanish at the University of North Carolina at Chapel Hill, but her interest in the telecom world started with a PR position at Connect2 Communications where she worked with a variety of clients focused on communications network infrastructure, including switches, routers, SBCs, data center equipment and systems. There, she witnessed the growing influence of fiber in the industry, as packet optical service delivery platforms transformed network performance and scale.

Her drive for communicating the impact of new technology translated into a communications position at the FREEDM Systems Center, a smart grid research lab at N.C. State University. While at FREEDM, Kelsey orchestrated the center’s webinar program which crossed multiple college campuses and covered research projects like cyber security in the smart grid, the center's smart solid-state transformer, fault isolation devices and distributed energy storage devices. She most recently worked in marketing at a healthcare company and is excited to take on the role of editor for Light Reading's Upskill U website.

Outside the office, she can be found riding her aging Raleigh-brand road bike or dodging snakes on runs through the local Raleigh, N.C., greenways. A glass half-full gal, Kelsey is grateful for the sunning reptiles because they motivate her to improve her timed miles.

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