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July 11 (UPI) -- Broadcom will purchase software company CA Technologies for $18.9 billion, the semiconductor giant announced Wednesday. By purchasing the U.S.-based company, Singapore-based Broadcom will gain a wider reach in the U.S. technology field and diversify its market share by expanding its role in the cloud-based software CA Technologies is known to specialize in.
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Under the agreement, CA's shareholders will receive $44.50 per share in cash, which amounts to a premium of 20 percent.
"The all-cash transaction represents an equity value of approximately $18.9 billion, and an enterprise value of approximately $18.4 billion," Broadcom said in a statement.
The purchase comes about four months after President Donald Trump blocked Broadcom's attempt to purchase U.S.-based Qualcomm for $117 billion on grounds that the United States needed to protect its information technology companies from foreign interests.
"This transaction represents an important building block as we create one of the world's leading infrastructure technology companies," Hock Tan, president and chief executive officer of Broadcom, said in a statement.
Tan added: "With its sizeable installed base of customers, CA is uniquely positioned across the growing and fragmented infrastructure software market, and its mainframe and enterprise software franchises will add to our portfolio of mission critical technology businesses. We intend to continue to strengthen these franchises to meet the growing demand for infrastructure software solutions."
