Broadcom and CA Technologies on Wednesday announced that Broadcom has agreed to acquire the enterprise technology company for $18.9 billion in cash.
The deal values CA stock at about $44.50 per share, or a premium of about 20 percent to the closing price of CA common stock on July 11.
The acquisition represents a strategic win for Broadcom, furthering its mission to acquire "mission critical technology businesses," following its failed takeover bid for rival Qualcomm.
CA Technologies, which manufactures cloud-based and traditional enterprise software, could help diversify Broadcom, should it gain antitrust approvals in the U.S., the E.U. and Japan. The boards of both companies have already approved the deal.
Shares of CA Technologies soared more than 16 percent in extended trading, after an earlier report by the Wall Street Journal that Broadcom was close to acquiring the software company.
Shares of Broadcom edged down more than 5 percent, pushing the stock down to about $299 per share. Broadcom is down more than 5 percent year-to-date, amid a tumultuous year for the chipmaker's stock value.