Avago buys Broadcom in $37bn chipmaker tie-up

Singapore-based Avago Technologies announced plans Thursday to buy rival Broadcom in a $37 billion deal creating a mobile chipmaking powerhouse.

The stock-and-cash deal "creates the world's leading diversified communications semiconductor company," according to a statement from the companies.

The combined firm will have a market value of $77 billion and revenue of $15 billion, according to the statement.

It would be a key player in components in the surging market for mobile devices like smartphones and tablets.

"Today's announcement marks the combination of the unparalleled engineering prowess of Broadcom with Avago's heritage of technology... in a landmark transaction for the semiconductor industry," said Hock Tan, Avago's chief executive.

"The combination of Avago and Broadcom creates a global diversified leader in wired and wireless communication semiconductors."

Avago was originally a semiconductor unit of US-based Hewlett-Packard. It has operations in California as well as its Singapore home base.

Tan will head the combined company on completion of the deal, which includes $17 billion in cash and $20 billion in stock. It is expected to close early next year.