Well, we’ve heard rumor after rumor that Dell would
eventually consider using AMD processors. Everyone dismissed the rumors
and said that the analysts were blowing smoke. Eventually, Dell caved and
announced that it would use Opteron processors in some of its server systems.
Well, everyone loves a good rumor and this one is a whopper. Forbes is confidently
reporting that AMD may be in talks to buy ATI Technologies, claiming that an "AMD-ATI Merger Looks Likely."
ATI employees have been talking and analysts are buzzing
about the possibility of an AMD-ATI merger. "The synergies of this seem
consistent with the recent announcements by AMD to significantly increase
capacity over the next few-years. We believe ATI is a rare-buy in the
semiconductor space right now given the near-term tie-up dynamics," said
analyst Apjit Walia.
AMD and ATI are already closely linked together as ATI
provides integrated chipsets for AMD desktop and notebook chip offerings. ATI's
recently announced Radeon
Xpress 1100 and 1150 chipsets provide DX9-level integrated graphics
capabilities for AMD's new AM2 processors. And chances
are if you purchase an AMD based notebook, you’re going to find an integrated
ATI chipset under the keyboard. But while ATI has the upper hand in the mobile
sector with AMD systems, NVIDIA clearly is the leader on the desktop side of
things. It remains to be seen what an AMD-ATI merger would do for the desktop
But does a merger between AMD and ATI really make sense at
this point in time? Forbes reports:
Walia based his
prediction on recent checks in the PC food chain. RBC has an
"outperform" rating and $23 price target on ATI, and no rating on
AMD. The firm expects ATI to report fiscal 2007 earnings per share of $1.06. It
has long been discussed that the graphics-companies are likely to be bought by
one of the microprocessor companies, according to Walia. However, for AMD-rival
Intel, a partnership with a graphics company may not be the best idea.
Thanks to Ryan Shrout and mAdD INDIAN for sending in this
news. Of course, Forbes has been wrong before.