56Up to Tuesday’s close, Brocade’s shares had gained nearly 30

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The deal, the latest in a consolidating chip sector, will allow Broadcom to corner a larger share of the data center products market by using Brocade’s fiber channel switches that speed up data transfer between servers and storage devices.“The deal is highly complementary to Broadcom’s existing enterprise storage offerings and boosts its exposure to the high growth data center market,“ CFRA Research Angelo Zino said.The market for IT infrastructure products is expected to expand rapidly. Total spending on cloud infrastructure, including server, storage and ethernet switches, will increase by 15.5 percent to $37.1 billion in 2016, according to research firm IDC.“We are very strategic with divestitures. There’s logical buyers in the networking space for this business,“ Broadcom’s chief financial officer Tom Krause said in an interview.The $12.75 per share offer represents a premium of 46.7 percent to Brocade’s close on Friday.Brocade’s shares closed up 9.6 percent at $12.32, while Broadcom’s stock closed 2.2 percent higher at $172.56Up to Tuesday’s close, Brocade’s shares had gained nearly 30 percent since it was reported on Monday that the company was in talks to sell itself.The chip industry has been undergoing rapid consolidation as companies try to capture market share, much of it related to connected devices and cars, and Avago/Broadcom has been one of the sector’s most prolific acquirers.Since taking over the top job at Avago a decade ago, Chief Executive Hock Tan has turned around a small chipmaker into a giant with a market capitalization of $67 billion.

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