LONDON, UK / ACCESSWIRE / July 6, 2017 / Pro-Trader Daily takes a look at the latest corporate events and news making the headlines for Broadcom Ltd (NASDAQ: AVGO), following which we have published a free report that can be viewed by signing up at http://protraderdaily.com/optin/?symbol=AVGO. The US Federal Trade Commission (FTC) on July 03, 2017, granted conditional approval to the $5.9 billion takeover of Brocade Communications Systems, Inc. by Broadcom. The condition set forth by the FTC is that Broadcom would establish a "firewall" so that it will not be able to access proprietary information about Broadcom's customer and Brocade's major competitor - Cisco Systems Inc. For immediate access to our complimentary reports, including today's coverage, register for free now at:

http://protraderdaily.com/register/

At Pro-TD, we make it our mission to bring you news that matter about the stock you follow. Today, our research desk covers a blog story on AVGO. Go directly to your stock of interest and access today's free coverage at:

http://protraderdaily.com/optin/?symbol=AVGO

FTC's concern and suggestion

FTC's concern is with regards to the fiber channel switches which are manufactured by only two major competitors in the world - Brocade and Cisco Systems, Inc. FTC feels that Broadcom's acquisition of Brocade will result in Broadcom getting access to proprietary business information about Brocade's direct competitor Cisco. Broadcom could use the information to stifle the competition and slow down the innovation in the global market of fiber channel switches. This could result in customers having to pay a higher price for the fiber channel switches or any innovation in this field abridged.

Fiber channel switches are part of storage area networks that transfer data between servers and storage arrays in data centers. Because fiber channel switches can quickly and securely transfer large amounts of data, they are often used for mission-critical applications.

The issue is particularly critical because Broadcom designs fiber channel application specific integrated circuits, or ASICs, that are custom-tailored to carry out the functions of each switch. Broadcom caters to both the manufacturers of fiber channel switches - Brocade and Cisco.

The conditional grant from FTC would prevent Broadcom from using Cisco's confidential business information for any other purpose than to design, manufacture, and sell fiber channel ASICs for Cisco.

Future plan

As per the FTC directive, Broadcom will need to have a separate facility as well as a separate information technology system for the business group that handles development, production, sales, and marketing of fiber channel ASICs for Cisco. The security protocols for this group as well as the IT system will grant access only to certain authorized individuals. The other information will be contained within the protection of the firewall. FTC will appoint a person to monitor the system for a period of five years to ensure that Broadcom complies with the FTC's directions. FTC holds the right to extend this monitoring for a further five years if required.

FTC has given a 30 days' time for the public to make their comments on the matter. The Commission has indicated that it will give its final view on the Broadcom/Brocade deal after August 02, 2017.

The Broadcom/Brocade deal

Broadcom had announced the acquisition of Brocade in November 2016. The all-cash deal was valued at $5.9 billion, including debts. Broadcom had agreed to pay $12.75 in cash for each Brocade's share. The merger agreement also detailed Broadcom assisting Brocade in divesting its IP networking business which included the wireless and campus networking, data center switching and routing, and software networking solutions. The divestment was planned so that the "competitive" overlap of some important customers could be avoided. The deal was one of the biggest in the semiconductor industries in recent times.

Last Close Stock Review

At the closing bell, on Wednesday, July 05, 2017, Broadcom's stock rose slightly by 0.81%, ending the trading session at $231.61. A total volume of 2.97 million shares has exchanged hands, which was higher than the 3-month average volume of 2.71 million shares. The Company's stock price skyrocketed 5.78% in the last three months, 29.87% in the past six months, and 53.63% in the previous twelve months. Moreover, the stock soared 31.02% since the start of the year. The stock has a dividend yield of 1.76% and currently has a market cap of $93.36 billion.

Pro-Trader Daily:

Pro-Trader Daily (Pro-TD) produces regular sponsored and non-sponsored reports, articles, stock market blogs, and popular investment newsletters covering equities listed on NYSE and NASDAQ and Canadian stocks. PRO-TD has two distinct and independent departments. One department produces non-sponsored analyst certified content generally in the form of press releases, articles and reports covering equities listed on NYSE and NASDAQ and the other produces sponsored content (in most cases not reviewed by a registered analyst), which typically consists of compensated investment newsletters, articles, and reports covering listed stocks and micro-caps. Such sponsored content is outside the scope of procedures detailed below.

PRO-TD has not been compensated; directly or indirectly; for producing or publishing this document.

PRESS RELEASE PROCEDURES:

The non-sponsored content contained herein has been prepared by a writer (the "Author") and is fact checked and reviewed by a third-party research service company (the "Reviewer") represented by a credentialed financial analyst [for further information on analyst credentials, please email contact@protraderdaily.com. Rohit Tuli, a CFA® charter holder (the "Sponsor"), provides necessary guidance in preparing the document templates. The Reviewer has reviewed and revised the content, as necessary, based on publicly available information which is believed to be reliable. Content is researched, written and reviewed on a reasonable effort basis. The Reviewer has not performed any independent investigations or forensic audits to validate the information herein. The Reviewer has only independently reviewed the information provided by the Author according to the procedures outlined by PRO-TD. PRO-TD is not entitled to veto or interfere in the application of such procedures by the third-party research service company to the articles, documents or reports, as the case may be. Unless otherwise noted, any content outside of this document has no association with the Author or the Reviewer in any way.

NO WARRANTY

PRO-TD, the Author, and the Reviewer are not responsible for any error which may be occasioned at the time of printing of this document or any error, mistake or shortcoming. No liability is accepted whatsoever for any direct, indirect or consequential loss arising from the use of this document. PRO-TD, the Author, and the Reviewer expressly disclaim any fiduciary responsibility or liability for any consequences, financial or otherwise arising from any reliance placed on the information in this document. Additionally, PRO-TD, the Author, and the Reviewer do not (1) guarantee the accuracy, timeliness, completeness or correct sequencing of the information, or (2) warrant any results from use of the information. The included information is subject to change without notice.

NOT AN OFFERING

This document is not intended as an offering, recommendation, or a solicitation of an offer to buy or sell the securities mentioned or discussed, and is to be used for informational purposes only. Please read all associated disclosures and disclaimers in full before investing. Neither PRO-TD nor any party affiliated with us is a registered investment adviser or broker-dealer with any agency or in any jurisdiction whatsoever. To download our report(s), read our disclosures, or for more information, visit http://protraderdaily.com/disclaimer/.

CONTACT

For any questions, inquiries, or comments reach out to us directly. If you're a company we are covering and wish to no longer feature on our coverage list contact us via email and/or phone between 09:30 EDT to 16:00 EDT from Monday to Friday at:

Email: contact@protraderdaily.com

Phone number: (917) 341.4653

Office Address: Mainzer Landstrasse 50 Frankfurt am Main, Germany 60325

CFA® and Chartered Financial Analyst® are registered trademarks owned by CFA Institute.

SOURCE: Pro-Trader Daily