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Chipmaker Broadcom to buy network gear maker Brocade for $5.5 billion

Broadcom Limited company logo is pictured on an office building in Rancho Bernardo, California May 12, 2016.

Chipmaker Broadcom Ltd (AVGO.O) said on Wednesday it would buy network gear maker Brocade Communications Systems Inc (BRCD.O) for $5.5 billion in cash, to expand its fiber channel and data storage businesses.

The $12.75 per share offer represents a premium of 46.7 percent to Brocade's close on Friday.

Bloomberg reported on Monday that Brocade was in talks to sell itself.

Brocade shares were up 7.2 percent at $12.05 in premarket trading on Wednesday. Broadcom shares were untraded.

Singapore-based Broadcom...