Broadcom reportedly commenced talks to buy software group VMware in a deal which could be worth more than $50 billion, as the US chipmaker continues efforts to transform itself into a diversified technology company.

Reuters reported a deal is not believed to be imminent but noted if a purchase materialises it would build on Broadcom’s acquisitions of enterprise software providers AppNeta, Symantec’s security division and CA Technologies over the past four years.

The news agency stated VMware’s market capitalisation was $40.3 billion at the close of trading on 20 May. The cloud computing specialist was spun off from Dell Technologies in November 2021.

Financial Times (FT) reported Dell founder Michael Dell currently owns about 36 per cent of VMware and also serves as its chairman, while other reports place his stake at around 40 per cent.

Former US President Donald Trump killed off an attempt by Broadcom to acquire Qualcomm in 2018, citing national security concerns.

FT noted Broadcom president and CEO Hock Tan has been on a hunt for software deals ever since.

Bloomberg reported Tan told analysts in March that Broadcom had the capacity for a “good size” acquisition.

The news agency also cited Wells Fargo analysts as stating an acquisition of VMware would be consistent with Broadcom’s focus on “building out a deepening enterprise infrastructure software strategy”.