Avago agrees to acquire Broadcom Corp for $37 billion

Avago Technologies agreed to acquire Broadcom Corp for $37 billion on Thursday, representing one of the biggest tech deals in history and further consolidation of the chip industry.

Avago, the acquisitive former semiconductor unit of Hewlett-Packard Co., has been at the forefront of aggressive acquisitions in the sector, as part of an effort to break into new markets and expand its business.

The company recently acquired the networking products maker Emulex Corp for approximately $606 million.

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Neither of the two companies have enjoyed significant dominance in the market, with the dominant players being Intel Corp. and Qualcomm Inc.

But this deal could help address that, turning a lesser known company into one of the most important industry players.

The combined company, which will be based in Singapore and known as Broadcom, is on track to become the third-largest U.S. semiconductor maker by revenue, behind Intel and Qualcomm.

Broadcom’s shares closed down 1.5 percent at $56.25 on Thursday, while Avago’s fell 0.62 percent to $142.38.

The companies expect the deal to be close by the end of the Q1 2016.

Avago was advised by Deutsche Bank, Bank of America, Barclays, Citigroup and Credit Suisse.

Broadcom was advised by JPMorgan Chase and Evercore served as financial adviser to the Special Committee of the board.