Chipmaker Avago Technologies (AVGO) said it agreed to acquire rival Broadcom (BRCM) for $37 billion in cash and stock. The deal values the combined company at $77 billion. Avago would acquire Broadcom for $17 billion in cash and 140 million Avago shares. Avago said upon completion of the acquisition, the combined company will have the most diversified communications platform in the semiconductor industry, with combined annual revenues of about $15 billion. Avago president and chief executive officer Hock Tan 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 (HPQ), AT&T (T), and LSI Logic (LSI), in a landmark transaction for the semiconductor industry. The combination of Avago and Broadcom creates a global diversified leader in wired and wireless communication semiconductors. Avago has established a strong track record of successfully integrating companies onto its platform. Together with Broadcom, we intend to bring the combined company to a level of profitability consistent with Avago's long-term target model.' Tan will continue to serve as president and CEO of the combined company, which will adopt the name Broadcom Limited. The transaction is expected to close in the first quarter of next year and is subject to approval by shareholders and regulators. Shares of both companies were rising on the news.