Semiconductor company Avago Technologies is to acquire rival Broadcom in a $37 billion deal, in a move which the acquirer said will give it “the most diversified communications platform in the semiconductor industry”.

Hock Tan, president and CEO of Avago, said in a statement: “Today’s announcement marks the combination of the unparalleled engineering prowess of Broadcom with Avago’s heritage of technology from HP, AT&T, and LSI Logic, in a landmark transaction for the semiconductor industry.”

Broadcom is active in a number of markets, including wireless technology products across Wi-Fi, Bluetooth and NFC, as used in a range of products including smartphones and tablets as well as home electronics products. It is also active in the small cell market.

Other products target markets such as set-top boxes, broadband modem products and Ethernet technology.

But in the face of tough competition, it has previously opted to wind-down its cellular baseband business, because “the commercial and economic opportunity was not sufficient to justify the continued investment”.

Its customer list includes Alcatel-Lucent, Apple, Cisco, Huawei, Samsung and ZTE.

Avago also addresses the wireless market with a “wide range of RF semiconductor devices that amplify, as well as selectively filter, RF signals”. It is also active in the wired and enterprise storage markets.

As news of the deal broke, it was noted that in terms of market capitalisation, the companies are not dissimilar in size. While Avago is smaller in revenue terms, it is faster-growing.

On completion of the deal, the company will adopt the Broadcom name. Avago is paying $17 billion in cash and $20 billion in shares, resulting in Broadcom shareholders owning around 32 per cent of the combined business.

It is subject to regulatory and shareholder approvals. Completion is expected by the end of the first calendar quarter of 2016.