How Broadcom CEO Hock Tan shaped a tech giant through acquisitions

30/5/2022 7:10:00 AM

How Broadcom CEO Hock Tan shaped a tech giant through acquisitions

Hock Tan, CEO of Broadcom, speaks on the floor of the New York Stock Exchange shortly before the opening bell in New York, US, on Feb 12, 2018.- Advertisement - The Last Fools: Eight Immortals of Lee Kuan Yew has restored somewhat my faith that the real Singapore story may yet have its full-blown Rashomon day in the sun.A few floors down, workers scurry about setting up partition walls at the void decks ahead of a series of dialogue sessions residents will be having with government officers.However, the headwinds that many disruptive companies face do bear uncanny similarities with the events in 2000.

Reuters Once a poor "skinny kid" from Malaysia, Hock Tan was going head-to-head with a legendary US technology mogul for a transformative acquisition.Tan placed a call earlier this month to VMware Inc Chairman Michael Dell, also the chief executive of computer maker Dell Technologies Inc.Don’t be fooled by hyperboles – “foolhardy geniuses”, “final high priests of a wildly secular order”, “ultimate knights” – found in the book’s Introduction.He proposed one of the biggest tie-ups in the history of the technology sector.After all, they were among the first inhabitants of the Housing and Development Board (HDB) estate when the block was built in 1980, having been resettled by the Government from a kampung in Mandai.Broadcom Inc, the chip maker that Tan leads, was willing to acquire VMware, a cloud software company for $61 billion (S$83 billion).They did, in their own determined ways, as much for post-independent Singapore as the inner circle of first-generation political leaders – and did offer, at least for a few, the type of positive tension that LKY said existed between him and Goh Keng Swee.For Tan, now 70, the deal would be the culmination of a string of acquisitions that has helped him turn Broadcom into a technology conglomerate worth $225 billion, along the way building a reputation as an astute dealmaker and ruthless cost-cutter.But waiting for profits to turn up gets more expensive when.

Dell, who personally owns 40 per cent of VMware and controls it together with buyout firm Silver Lake, had a decision to make.To use the title of Peh Shing Huei’s earlier book on Philip Yeo, the brash 2G economic investment czar, the eight immortals were neither always civil nor servant.“If we have the choice, we’ll stick together as neighbours again.Hold out for a better deal or risk losing out as technology stocks plunged amid concerns about a looming economic slowdown and rampant inflation.Broadcom offered $61 billion in cash and stock for VMware, a 50 per cent premium to where the shares of the latter were trading.This last revelation, which should not have come as a surprise, may likely get more airing with time as more books appear to put the record straight.To clinch the deal, Tan also agreed to give VMware 40 days from the signing of the deal to search for another suitor who may offer a better price.Around 1980, government officers began making the rounds informing kampung residents that they had to move because the Government needed the land for development.VMware said yes.Bogaars Story.The compression in Sea Limited’s price-to-sales ratio selling down its stake in January, has led to Sea’s share price collapsing 80 per cent from its peak in October 2021.

This account of the negotiations is based on people involved in the deal who requested anonymity.Broadcom had been eyeing VMware for months but held off from making an approach because it was concerned that Dell and Silver Lake would not engage due to the timing of VMware's spin-off from Dell Technologies in November 2021.There might be respect, but less awe,” Henson was quoted by The Straits Times as saying.” In 1981, she moved into a flat for the first time with her husband and her three-year-old child on the seventh storey of Block 217 Marsiling Crescent.Shareholders risk losing the tax-free status of their spin-off if their company engages in sale talks in the first six months after the separation.Tan's cost-cutting reputation prompted VMware's chief executive Raghu Raghuram to write to his employees on the deal's announcement to assure them that the "perception" of Broadcom putting profits ahead of innovation was "inaccurate".I hope more writers – especially younger ones – step up and do their part to provide less one-sided insights into the making of modern Singapore.He wrote that Tan "is committed to cultivating a shared culture of innovation.Ms Poh Geok Khin, 68, guessed that there were probably about 50 homes at the time.Spread sheet for Grab valuation attached.

" That reputation stems from Tan's strategy of acquiring businesses he calls "franchises" and then slashing what he sees as excessive sales and marketing expenses and unnecessary investments.John Drysdale in Singapore: Struggle For Success , published in 1984, wrote that Lim Kim San saw the Bukit Ho Swee fire in 1961 as an opportunity to clear squatter land for redevelopment, for building Housing and Development Board flats.He is also quick to jettison parts of those businesses that underperform."He runs Broadcom like an investment portfolio.The new Chief Executive of the HDB, Singapore’s one-year-old housing authority, knew right away that it was a chance to clear one of the island’s most notorious ghettoes and build a new town.After they moved out, the old Mandai Camp was built on that land, according to the six families in Block 217...Government officials who were previously sent to Bukit Ho Swee to resettle squatters were beaten up…The morning (after the fire), the place was cordoned off.AMAZON’S SURVIVAL STRATEGY The outlook for tech companies looks worrying.

they are all independent fiefdoms," said a former employee at the company who worked closely with Tan.Moving to the new flats took a while to adjust at first."If he has a dominant position in any market, he'll go in and raise those prices.Let’s have a plan." Tan and Broadcom did not respond to requests for comment.Tan has said he was an "18-year-old skinny kid" growing up in Malaysia when he won a scholarship in 1971 to attend engineering school at MIT.“Such was Howe’s efficiency that it prompted a long-running rumour that the Government had started the fire so as to build a new housing estate.After moving to a HDB flat, there’s no space,” she said.His parents could not afford to send him to college.It was able to collect money from customers before its suppliers had to be paid.

He went on to earn an MBA from Harvard University.And he had to do that in 10 years – by 1987.He held several executive positions in Malaysia and the United States, before joining chip maker Integrated Circuit Systems in 1994, rising to become chief executive in 1999.“Some of them have moved out after their children grew up,” she said.It was Silver Lake that helped recruit Tan as chief executive of the company that would go on to become Broadcom.When I was a boy, I lived in a stilt house above Kallang River in Lorong 1, Geylang and waste disposal was nothing like what it is today.In 2006, Tan joined Avago Technologies, a semiconductor company that Silver Lake and KKR Co Inc, another buyout firm, had acquired the year before for $2.66 billion.So I can appreciate Lee Ek Tieng’s under-appreciated achievement in cleaning up the two rivers.Four years later, the Government again acquired their land and they were resettled temporarily at an HDB flat before moving to Blk 217 in 1983.While Amazon survived the dot-com crash to become an Internet juggernaut, it has not been spared from the recent tech sell-off.

A spate of deals followed as Tan embarked on consolidating the semiconductor industry, often with backing from Silver Lake.In 2014, Avago paid $6.MediaCorp (or was it Singapore Broadcasting Corporation?) captured the river cleanup result quite remarkably.6 billion for storage chipmaker LSI Corp.Shipyard worker Na Hock Chuan, 67, pointed out that times were different back then and relocating has become far more troublesome and costly than when he moved over from the kampung in 1982.In 2015, it acquired Broadcom for $37 billion and took its name.She declared, with a big smile: “The prawns are back!” The prawns did not reappear by chance.In 2016, Broadcom acquired network gear maker Brocade Communications Systems Inc for $5.But cash generation should be at the heart of their survival kit.

9 billion.The Last Fools: The Eight Immortals of Lee Kuan Yew (edited by Peh Shing Huei) is published by The Nutgraf Books.The furniture we had were cheap and lousy,” said Mr Na, who lives on the 13th floor.Qualcomm bid thwarted In 2017, Broadcom launched a hostile $117 billion takeover bid for rival chipmaker Qualcomm Inc that would have been the largest technology deal of all time.It was thwarted by the US government over concerns that Broadcom, which was at the time headquartered in Singapore, would become too dominant in the US semiconductor industry at the expense of innovation.Tan Bah Bah, consulting editor of TheIndependent.Tan then turned his attention to software companies, which like semiconductors can generate reliable cash flow.Asked whether he felt it was troublesome to relocate, handyman Nar Kim Tian, 69, said: “Not at all.Broadcom took over business software firm CA Technologies Inc for $18.He was also managing editor of a magazine publishing company.Today, the shares are worth over US$2,000 apiece.

9 billion and acquired Symantec Corp's security division for $10.7 - Advertisement -.” Given that they have known each other for decades, hawker Pak Leh Hua, 59, has just one wish.Following every acquisition, Broadcom paid down much of the debt it had taken on to help fund it, using the cash flow of its businesses.This has emboldened Tan to carry on with his spree of acquisitions, said Matt Britzman, analyst at Hargreaves Lansdown."Broadcom has de-levered quickly after each large acquisition," Britzman said.For tech entrepreneurs today , patience and focus are key.


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