Broadcom is expanding its chipmaking empire with the acquisition of network gear maker Brocade Communications.

Brocade specialises in data storage and networking, while Broadcom provides connectivity components such as Wi-Fi chips to companies like Apple. Under the deal, Broadcom will retain Brocade's Fibre Channel storage area network (FC SCAN) switching business and divest the company's IP networking business—including wireless and campus networking, data centre switching and routing, and software networking solutions—which was recently acquired by Ruckus Wireless.

Broadcom's move to acquire Brocade comes at a time where data centres are increasingly important, thanks to the growing popularity of Internet of Things (IoT).

“With deep expertise in mission-critical storage networking, Brocade increases our ability to address the evolving needs of our OEM customers. In addition, we are confident that we will find a great home for Brocade’s valuable IP networking business that will best position that business for its next phase of growth," said Hock Tan, president and CEO of Broadcom.

“Our best-in-class FC SAN solutions will help Broadcom create one of the industry’s broadest portfolios for enterprise storage," said Lloyd Carney, CEO of Brocade.