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Reports claim a $5.6B deal is about to close on an unprecedented merger

According to a report in The Globe and Mail, the board of directors at AMD has allegedly approved the takeover of Canadian graphics firm ATI Technologies. The report claims that the information was released by an investment banker that was part of the discussions. According to other sources, AMD executives were also seen at ATI's headquarters in Markham, Ontario. The report indicated that AMD is considering a $5.6 billion takeover bid for ATI.

Speculation and rumors have run rampant over the last several months about the possible merger between AMD and ATI, but no concrete details have been revealed. According to reports on ATI's share prices, the company's shares have been trading at double the usual volume today. Analysts said that AMD would be making an offer of 20 to 40 percent premium to ATI's current share price. ATI shares traded at $16.12 on the NASDAQ today during after hours, which is up 39 cents from yesterday's closing.

Reuters has also picked up on the story, claiming that "Some analysts have questioned the rationale for an AMD-ATI merger, and others were surprised that the speculation received no attention from analysts during AMD's earnings conference call on Thursday."  DailyTech had punched in for question during the investor conference call on Thursday, but a moderator would not respond.

According to Eric Gomberg, an analyst for investment bank Thomas Weisel Partners, "there has been considerable industry speculation that AMD may pursue an acquisition of ATI Technologies, although such an outcome is by no means certain." Gomberg's comment came in earlier this week, but word circulating around investment bankers who are aware of the talks between ATI and AMD surfaced just several hours ago.

Recent reports indicated that Intel roadmaps no longer included ATI chipsets. Although Intel had been producing motherboards using ATI logic, upcoming boards like those that support Core 2 processors are void of any chipset from ATI. Interestingly, ATI and Intel had agreed to several cross-licensing programs that allowed them to take advantage of some of each other's technologies. Several analysts however, indicated that the merger between AMD and ATI to be "out of strategy for AMD and out of focus. Stupidity is no barrier to tech mergers."

A report in the Wall Street Journal confirms the talks between AMD and ATI (subscription required) today. Although the deal is not final, the report said that representatives from both companies declined to comment.

AMD has previously indicated that it would embrace embedded processor technologies for its Torrenza platform -- some of which would include math and physics co-processors.  However, the company has recently exited all non-x86 processor design.

Update 07/24/2006: AMD and ATI jointly announced the confirmation of the $5.4B merger today (July 24, 2006)


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if this goes through...
By mushi799 on 7/22/2006 1:33:59 AM , Rating: 2
Ati's loss (selling chipset on the intel platform)

Nvidia's gain - they have intel all to themselve with only one competitor, intel




RE: if this goes through...
By michal1980 on 7/22/06, Rating: -1
RE: if this goes through...
By blazeoptimus on 7/22/2006 2:21:59 AM , Rating: 2
I seriously doubt Nvidia chipsets will lose performance with an AMD processor. That all seemed to disapeer with integrated memmory controllers(one of the most differentiating parts of a north bridge originally) into the cpu. There's been alot of talk of AMD using this to integrate graphics straight into the cpu, which might be a possibility. AMD itself has been moving to have other types of processors work in its cpu sockets on the same board. Maybe they'll have a gpu socket? Alot of the sucess of this possible venture would depend on how well the merger is executed and what the end company would look like. We wouldnt have a clear picture of that till sometime after the merger. Sadly by then its to late if it was a bad idea. Who knows? I know my reality ha s shifted.


RE: if this goes through...
By lethalchronic on 7/22/2006 11:53:40 AM , Rating: 2
Can anybody say co-processors.


RE: if this goes through...
By S3anister on 7/22/2006 12:50:30 PM , Rating: 2
quote:
Maybe they'll have a gpu socket?


lol... super socket 7... but for video cards!!!

oh and this will suck if AMD loses nvidia, which means amd is no longer who i buy anymore, cause i'm a way bigger nvidia fan than amd fan.


RE: if this goes through...
By Locutus465 on 7/22/2006 8:20:19 PM , Rating: 2
Super socket 7 was a great experience for me. Provided me with the computing power I needed in my college days at a price I could afford. I'm not going to complain at all about my experience there...


RE: if this goes through...
By Torched on 7/22/2006 8:50:23 AM , Rating: 3
Everyone needs to hold on for just a sec. Most everyone's comments are assuming AMD will let ATI keep its brand name... If the chipsets are rebranded to AMD how will you feel about nvidia's position then??? It will no longer have any major competition from a 3rd party vendor. AMD could then sell any part of the acquisition it felt like... i.e. crossfire. They may even just dump the tech all together and consolidate the industry to SLI. It would not be that hard for them to tack on the sli to the ati chipset. Besides... can anyone see an AMD branded video card? Its not like Intel sells stand alone video cards. This is why I see AMD dumping the video card to another third party and keeping what it needs for just chipsets and physics.


RE: if this goes through...
By TheDoc9 on 7/22/2006 11:38:57 AM , Rating: 1
exactly. This is probably the situation, I was going to mention it myself If I hadn't seen it.

What will most likely happen, NVIDIA will be the *only major player for graphics now. ATI will simply be disolved. The Nforce will probably all but disapear all together, only NVIDIA's GPU's (in the form of add-in cards and for notebooks) will continue to be produced.

In many ways this is a good move for AMD. BAD for the graphics industry...no competition for NVIDIA.


RE: if this goes through...
By Ard on 7/24/2006 2:15:37 AM , Rating: 2
That is not likely to happen as this is being labeled as an acquisition, not a merger. In an acquisition, both companies retain their identity. There's also the issue regarding the fact that ATI brings in a good chunk of money with their graphics division, money that AMD isn't going to just throw away. What is more likely to happen is that ATI will become a wholly owned subsidiary of AMD and still produce GPUs, while producing a solid chipset platform that AMD can label as their own.


RE: if this goes through...
By rushfan2006 on 7/24/2006 3:07:54 PM , Rating: 2
Exactly. I think some folks are getting a little carried away with their scenarios -- making more drama out of it than what is likely the truth. Its billed as an acquisition. Chances are ATI will me become "a subsidiary of AMD, inc."....


RE: if this goes through...
By Torched on 7/24/2006 10:39:42 PM , Rating: 2
First off, this is a takeover. Be certain that Dave Orton and crew are now answering to Hector and Dirk now. What you say will happen in the short term but once the whole of ATI is under the AMD corporate umbrella, there will be no more need for the ATI brand name. Everything will be AMD.
Once again, in the long term, AMD will be able to spin off any division it wants to. It will own all the IP ATI has now and be able to licence the tech to Nvidia if it so chooses. On the other hand, if AMD wanted to keep Nvidia a close partner, they could easily dump Crossfire and keep everyone happy.
All this is great speculation but the greatest, and probably the entire reason for the take-over, is that AMD wanted a GPU to be integrated on die. You can take this to the bank. When this happens you can kiss the decrete graphics industry goodbye. Don't be mistaken that Intel will be left out either. I think they will come to market with a CPU-GPU quicker than AMD-ATI will.


holy sh!t
By soydios on 7/22/2006 12:54:50 AM , Rating: 2
wow...this is gonna be interesting...VERY interesting




RE: holy sh!t
By soydios on 7/22/2006 1:05:06 AM , Rating: 2
and congrats to DailyTech on being the first site to release this breaking news!
;)


RE: holy sh!t
By soydios on 7/22/2006 1:05:38 AM , Rating: 1
that would be according to Google News
and an Edit button would be really handy for the comments...


RE: holy sh!t
By bobdelt on 7/22/2006 1:57:48 AM , Rating: 1
yeah? I've never seen an article written by google


RE: holy sh!t
By xdrol on 7/22/2006 2:34:36 PM , Rating: 2
..and clearly you have never seen Google News ever.


RE: holy sh!t
By killamajig on 7/22/2006 2:01:16 AM , Rating: 2
Well, other than the Globe and Mail, which they referenced in their article...


RE: holy sh!t
By dvinnen on 7/22/2006 2:58:25 AM , Rating: 2
Actually, looks like the inquirer had them scooped by 12 hours

http://www.theinquirer.net/default.aspx?article=33...

But of course the inquirer is just a tabloid...


RE: holy sh!t
By wil2xl on 7/22/2006 7:18:08 AM , Rating: 2
No they didn't, look at the inq's article, it only says that the two companies are in talks and that AMD is "to ask" share holders for approval.

the dailyTech article actually talks about the confirmation.


RE: holy sh!t
By Justin Case on 7/22/2006 4:07:15 PM , Rating: 3
Actually they scooped them by almost two months. The first time the Inquirer posted about this deal was May 31st. And, as usual, every other site said they were making it up...

That is what's known as "news". After the merger is officially announced, it's just a matter of reporting.



RE: holy sh!t
By Knish on 7/22/2006 4:19:10 PM , Rating: 1
quote:
Actually they scooped them by almost two months. The first time the Inquirer posted about this deal was May 31st. And, as usual, every other site said they were making it up...

So what? Forbes scooped them. And everyone said the inquirer made it up because they have a habbit of doing so.

Didn't someone else at the inquirer also claim that this would not happen? We all know you work there by the way, you're not fooling anyone anymore.


Will Intel Buy nVIDIA?
By TomZ on 7/22/2006 8:09:57 AM , Rating: 2
If ATI provides some strategic advantage to AMD, then does it follow that nVIDIA might also provide a similar advantage to Intel? Does anybody see Intel reacting with an offer to purchase nVIDIA?




RE: Will Intel Buy nVIDIA?
By killerroach on 7/22/2006 8:38:20 AM , Rating: 1
Since I don't see Intel getting into the discrete graphics business, then no. Intel still makes what is arguably the best chipset for their platform, nVidia's IGP tech isn't that great, and nVidia doesn't seem to have a lot of tech to offer Intel, who spends an obscene amount of money on R&D.

That being said, it's possible, but only a couple of years down the road. I think right now regulators would scream bloody murder if Intel bought the company who makes most of the motherboard chipsets for the AMD platform.


RE: Will Intel Buy nVIDIA?
By L1NUXownz1fUR1337 on 7/22/2006 11:15:28 AM , Rating: 1
WTF?

The intel ceo is too busy playing golf and figuring out how to reduce intel from 100,000 employees to 40,000.

He just reduced the amount of people reporting to him so he concentrate more on golf.. uh.. - i mean layoffs

I think he's too busy to think about improving/growing the company.


RE: Will Intel Buy nVIDIA?
By TomZ on 7/22/2006 12:58:10 PM , Rating: 3
Sorry, I was actually looking for some intelligent replies, not just a load of crap. I guess I'll try again later.


RE: Will Intel Buy nVIDIA?
By shecknoscopy on 7/22/2006 3:16:10 PM , Rating: 1
quote:
Sorry, I was actually looking for some intelligent replies, not just a load of crap. I guess I'll try again later.


What - did you accidentally type something into this site, thinking you were reading the Inquirer? The dude *does* like golf, and he totally tents for layoffs. But again, by the same sensationalist media-fed jargon, the AMD CEO's too busy polluting Texas and killing adorably misrepresentative animated sallimanders to care about ATI.

Of course, who here thinks polluting texas is a bad thing? Show of hands? Bueller?

Anyway, one way I could see this going is having intel court nVidia to supply SLI support for all the intel chipsets which currently have only been Crossfire capibile. In the present situation, it clearly benefits both companies, whewreas nVidia's had a modest arguement against it previously. Considering that dual graphics solutions are becoming less and less the territory of the "bleeding edge" gamer, and are anticipated to seep progressively into the mainstream market, I can't imagine either company'd want to find the other side at a substantial advantage.


RE: Will Intel Buy nVIDIA?
By Locutus465 on 7/22/2006 8:28:34 PM , Rating: 2
They have been in the descreate graphics business before... In fact for a long time they were the leaders in AGP graphics cards...


RE: Will Intel Buy nVIDIA?
By masher2 (blog) on 7/22/2006 1:20:08 PM , Rating: 2
> "Does anybody see Intel reacting with an offer to purchase nVIDIA?"

Intel won't consider it, as such a merger wouldn't get FTC approval, given their dominant position in integrated graphics solutions.


RE: Will Intel Buy nVIDIA?
By Knish on 7/22/2006 4:24:24 PM , Rating: 2
quote:
If ATI provides some strategic advantage to AMD, then does it follow that nVIDIA might also provide a similar advantage to Intel? Does anybody see Intel reacting with an offer to purchase nVIDIA?

I think masher said it already but I couldn't find the comment to link back. Intel + NVIDIA would almost never go through the FTC, and NVIDIA is not hurting all all right now as far as stock prices and all. Neither ATI nor AMD were doing very well this year financially, but who knows.

As for the 5.6 billion: considering what AMD has spent on fabs this year alone, the 5.6 billion seems like a decent price to spend.


Everything..
By othercents on 7/22/2006 2:31:32 AM , Rating: 1
Ok now really I have seen people say this is bad for nvidia, but overall it really isn't. Nvidia can still be the same high end manufacturer of chipsets and video cards. They have signed other deals with Apple for video iPods and I'm sure they have many other things in the works.

This should just heatup competition and allow Nvidia to provide aftermarket chipsets for both AMD and Intel. Hopefully this will mean less ATI favoritism from Intel and maybe Intel will provide a chipset of their own that supports SLI.

So what about AMD and ATI?

Well ATI can quickly move into dual core GPUs and 45nm process. This should give the ATI brand an edge over all other video card manufacturers. This also allows AMD to manufacture their own chipsets and possibly their own motherboards. It is very possible that there might be a high end IGP for vista giving users the power they need to run all the latest games which the Intel IGP hasn't been able to do. Don't forget that Dell just started buying from AMD and now that there is a total CPU/GPU/Chipset package, we could start seeing AMD desktops from Dell.

You also need to think about all the manufacturing plants that ATI has. They build their own video cards which Nvidia doesn't even do. I think this is a win for everyone really. Especially the customers. You will have two CPU manufacturers that also create their own chipsets. However the advantage is to AMD since they will also have a very good video card line. (yeah I know core 2 makes Intel your god that you will now bow down and worship)

Other




RE: Everything..
By Niv KA on 7/22/2006 3:18:28 AM , Rating: 2
quote:
This should just heatup competition and allow Nvidia to provide aftermarket chipsets for both AMD and Intel. Hopefully this will mean less ATI favoritism from Intel and maybe Intel will provide a chipset of their own that supports SLI.


Intel doesn't favor ATi, Nvidia doesn't give them the SLI suport

-Niv K Aharonovich


RE: Everything..
By MartinT on 7/22/2006 3:26:07 AM , Rating: 2
quote:
Well ATI can quickly move into dual core GPUs and 45nm process.


(I) Forget about "dual-core" GPUs.

(II) We all know how well AMD does on the process front, this might actually impeed ATI's performance.

(Though I have to add that the pure though of producing 300mm² dies that sell for ~$60 in AMD's leading-edge FAB should send shudders down one's spine.)


RE: Everything..
By shecknoscopy on 7/22/2006 4:16:17 AM , Rating: 2
quote:
They have signed other deals with Apple for video iPods and I'm sure they have many other things in the works.


You know, it dawns on me now that, if Nvidia could produce Macs capable of playing any decent games from the previous half-decade, they'd have pretty much total dominance of a yet unexplored (and I assume, large) market. Namely: the eye-candy monkeys who like things "pwetty" and "simple," (read: "exclusively mac users") but who still want to get their game on. Provided that their game isn't exclusively "The Sims." Number one. With the settings set to low. And no sound.

I'm serious, here - the newest generation macs are pretty sexy. Now, if they could produce some decent 3D rendering in addition to "Garageband," I'd consider shelling out my hard-earned dough for them. Or mug someone else and use his dough. The point is, dough would be spent.


RE: Everything..
By Xavian on 7/22/2006 8:22:57 AM , Rating: 2
except the problem of most games in the last half-decade being written for DirectX and not OpenGL...

Just because you have a good graphics card in your system, doesn't mean developers are going to write games for it.


RE: Everything..
By lethalchronic on 7/22/2006 12:00:21 PM , Rating: 2
I'm not sure if I've resigned myself to the gallows just yet (i.e. the macintosh) ;)


RE: Everything..
By Locutus465 on 7/22/2006 8:22:44 PM , Rating: 2
Well in theory nVidia could continue to manufature AMD chipsets as they have in the past at the same quality levels. If they did they would continue to compete quite successfully... They have stated in the past that they might not be so interested should ATI and AMD merge, which would just be a damn shame.


Not such a stupid move
By BitJunkie on 7/22/2006 9:47:42 AM , Rating: 3
This might be about a lot more than just chipsets...

http://dailytech.com/article.aspx?newsid=2388

AMD development of HT, HTX and co-processors for K8L could mean they are trying to innovate in this space...highly optimised graphics solutions with super fast and phat inter-connects anyone?

K8L is going to nail Conroe, but it ain't going to be just the CPU architecture that does it me thinks. Platform wide innovation ftw. It's all part of the mix.




RE: Not such a stupid move
By BitJunkie on 7/22/2006 9:54:44 AM , Rating: 2
...also AMD's push for co-proc's will be put them as far ahead as 64 bit extensions did....assuming they get it right. You have to read this news in that context, I think.


RE: Not such a stupid move
By DigitalFreak on 7/22/2006 11:18:17 AM , Rating: 2
quote:
K8L is going to nail Conroe


Stop spewing bullshit. You have no idea how K8L will perform.


RE: Not such a stupid move
By BitJunkie on 7/22/2006 5:01:19 PM , Rating: 2
Nobody know's how K8L they're going to perform. But look at history, look at their track record. Also from a purely Darwinian perspective, they HAVE to outperform Conroe if they want to stay in competition, I don't believe a company that's investing in people, talent and production capacity, after fighting so hard to win market share is going to do anything else.

Lets hope Selective Evolution has some effect on mindless posts and trolls too.....okay who am I kidding that's less likely than AMD delivering the goods.


RE: Not such a stupid move
By BitJunkie on 7/23/2006 1:18:26 PM , Rating: 2
The key is how they perform the integration. If they're aiming to integrate GPU functionality on the CPUs, they have a couple of issues:

1) Who's technology do they use? How do they license it and how vulnerable does that leave their business if they opt to license technology.
2) Developing in-house Graphics capabilities puts them on a massive learning curve, places them in direct competion and introduces time constraints, they aren't going to be able to develop a competative solution in the 18 month timeframe
3) People, they don't grow on trees, even if the could develop their in-house capablities they'd be seriously constrained in terms of manpower.

This aquisition enables them to innovate relatively freely without concerns for the above issues. I don't think they're just going to develop a set of current day chip-sets, including a discrete GPU. That's not moving forward, it's just competing with whats around at the moment.

The next question is IF they manage to integrate ATI based GPU functionality in to a CPU, and see very real performance improvemnts - how do Intel compete?


RE: Not such a stupid move
By masher2 (blog) on 7/22/2006 1:24:11 PM , Rating: 2
> "AMD development of HT, HTX and co-processors for K8L could mean they are trying to innovate in this space...highly optimised graphics solutions with super fast and phat inter-connects anyone?"

You're right that this is about a lot more than just chipsets, but I imagine AMD is simply trying to break into the highly-lucrative integrated graphics market...which are, of course, low-end solutions.


my 1.2453434 cents
By cciesquare on 7/22/2006 3:58:39 AM , Rating: 5
I think this along with recent events, this does have a correlation. Lets start with allegations of Intel using unfair competition, then followed by a string of law suits. Now this aquistion. The question is what's all this have to do with anything?

I think it is about AMD's image. They are trying to change their image in a very very dramatic way. AMD has always been seen as the hidden brand, they have been in the shadows. The law suits and the mega aquistion, is a statement, sorta like a coming out party saying "Hi, we are AMD."

I think this is a huge huge huge gamble by AMD, whether they know what they are doing or not, miss managing ATI will give investors, customers and the public a glimpse at AMD's management and its ability to handle a growing company. To put it simply AMD is in the hot seat, if they mess up, they will be in a lot of trouble. Not to mention destroying a quality brand name in ATI, and down $5 billion dollars.




RE: my 1.2453434 cents
By Torched on 7/22/2006 9:00:13 AM , Rating: 2
Actually, AMD manages the channel better than Intel. Look at the Intel chipset allocation problem at the beginning of this year...
You could also look at how Fab 30 in dresden is at 150% capacity.
The only thing I would worry about is marketing, AMD's sore spot.


RE: my 1.2453434 cents
By lethalchronic on 7/22/2006 12:22:56 PM , Rating: 2
Amen, if AMD got some serious marketing together they go go sky high. I mean come on whens the last time anybody saw an AMD commercial on prime time tv. What about Intel, remember blue man group?

IMHO, this just leave a huge gap of potential for AMD, they might actually catch up to the massive gap in market share that Intel has been enjoying, albeit it might take a good while, maybe K9 (or is it K10 I've heard both but nothing is official anyway).


RE: my 1.2453434 cents
By TomZ on 7/22/2006 1:01:28 PM , Rating: 2
Sorry, I disagree. AMD is going to need great products and great marketing and great manufacturing and great prices to continue to win market share from Intel. Marketing alone won't be the solution. AMD needs to again leapfrog Intel in terms of product architecture again if they want to play at the next level.


GO AMD
By inthell on 7/22/2006 12:46:53 AM , Rating: 1
good news and good for AMD...damn thats a lot of cash




RE: GO AMD
By Furen on 7/22/2006 12:54:16 AM , Rating: 2
Good news for ATI. ATI is currently valued at 4.2B, if I remember correctly. A 5.6B AMD acquisition would mean a close to 35% appreciation in stock price.


RE: GO AMD
By masher2 (blog) on 7/22/2006 1:12:34 PM , Rating: 2
> "A 5.6B AMD acquisition would mean a close to 35% appreciation in stock price. "

It doesn't work that way. The acquiring company typically pays most or all the purchase price in stock issuance or options, which dilutes the share price. Even if they pay in cash, the shareprice doesn't neccesarily rise...it depends on the market's view of the acquisition itself. It can rise or fall.

The acquired company, now, is a different story. It's being purchased in toto and, for a publicly traded company, the only was for that to happen is to pay a premium above the market price. So the share price rises, at least slightly so.


RE: GO AMD
By Furen on 7/22/2006 3:08:34 PM , Rating: 2
I am referring to ATI, of course. And yes, I meant that AMD will pay close to 35% premium on its current price. I doubt it'll be a cash-only acquisition, since AMD does not have so much cash but I suppose 3-4B in loans could take care of that (LOL). When I said "A 5.6B AMD acquisition would mean a close to 35% appreciation in stock price" I meant that AMD would acquire it for 5.6B and that would be a 35% premium on ATI's current market cap. I'm fairly certain that AMD's stock will go down a bit as a result of this.


RE: GO AMD
By masher2 (blog) on 7/22/2006 3:44:11 PM , Rating: 2
> "I am referring to ATI, of course"

My apologies then; you are correct.


I'll believe it when I see it....
By MDme on 7/22/2006 12:52:07 AM , Rating: 3
This is really gonna be interesting for AMD....maybe they want to use the ring-bus memory controller technology for their cpu's remember it's a memory controller that performed well and also supported more than 1 type of memory (GDDR3/4)

Also, maybe this is AMD's way of getting GPUs into HTX/CPU slots for their Torrenza initiative.

It may also lead to a unique gaming landscape change when you consider benchmarking AMD (CPU) + ATI (GPU) systems vs core 2 and nvidia systems. I mean, AMD may want to capture the enthusiast/gaming market by claiming that AMD (CPU) + ATI (GPU) will be faster than conroe. (assuming the R600 beats the G80)

oh well....I'll believe it when I see it. :)




By Janooo on 7/22/2006 1:26:55 AM , Rating: 2
Intel already sells chipsets and boards; AMD is just catching up ;)
Selling CPU, chipset, mobo and GPU as a package makes a lot of sence.

And you are right: Torrenza with ATI physics and Conroe is obsolete for a gaming box!


RE: I'll believe it when I see it....
By theteamaqua on 7/22/2006 2:44:03 AM , Rating: 2
i totally agree with u mean. i dont want to see nvidia stop making chipset for AMD , nor intel chipset not supporting crossfire (umm i975)

and yeah VIA we need u in this crappy world of ours


By Locutus465 on 7/22/2006 8:16:40 PM , Rating: 2
To make it crappier? I've been using AMD products for a long time, at first because they were the only decent solution I could afford, then because the were presenting extreamly comptitive solutions to Intel and a reasonable price. Through out it all, the one constant issue had been chipsets, specifically VIA. It was so bad that even when AMD chipsets were considered out dated and obsolete durring the early athlon days I would continue to build systems for friends and family around them because it still provided an over all better computing experience compared to what VIA had on the market. It wasn't until nVidia entered the sceen that things got better.


wow
By beemercer on 7/22/2006 12:32:01 AM , Rating: 5
its getting cold down here in hell.




RE: wow
By tuteja1986 on 7/22/06, Rating: 0
RE: wow
By KristopherKubicki (blog) on 7/22/2006 4:26:40 PM , Rating: 2
I just talked to a fund manager who is responsible for ATYT at a major US investment firm. He had this to say:

quote:
The chatter is definately firming up, sounds like it is going to happen. Think it is a really bad deal for AMD, great for ATI because their crappy management team gets to throw in the towel.


RE: wow
By Tom Tom on 7/23/2006 10:43:02 PM , Rating: 1
The chatter is definately firming up, sounds like it is going to happen. Think it is a really bad deal for AMD, great for ATI because their crappy management team gets to throw in the towel.

Man thats about the weakest statement I've read for a long time. This fund manager has all the answers doesnt he Kris?


AMD is not ending deal with Nvidia
By Randalllind on 7/22/2006 12:14:10 PM , Rating: 2
My take is this AMD has team up with Dell. Dell needs chips and more chips. The chips they make now could very easy be eating by Dell. AMD therefore doesn't have any left for home builder etc.

ATI has fabs and the abilty to make chips today where as AMD would have to build more fabs to keep up. So buying ATI would ease AMD problems for the time being.

Now if in the future they stop making video cards and have everything intergrated into motherboards AMD would favor ATI no doubt. I am sure there will still be nvidia boards.

I am sure AMD wants the hard core ATI and Nvidia crowd and will keep both in the line up.




By RyanVM on 7/22/2006 12:25:08 PM , Rating: 2
Umm, ATI doesn't have any fabs...


By lethalchronic on 7/22/2006 12:53:47 PM , Rating: 2
Well they at least have contracts with third party fabs plus the new AMD fab is being built in New York state. Of course this fab won't be operational for a good while.


By NMDante on 7/22/2006 3:39:45 PM , Rating: 2
ATI uses foundries for it's chips, just like nVidia. So, it won't ease AMDs problems at all. If anything, it might take up "free" fab capacity, but might require re-tooling of certain tools for different processes.

If ATI stopped making standalone GPUs, that would hurt the video card community, since it will leave nVidia (with some stragglers) as the only game in town, and the now $700 top of the line, will be more expensive and the pushing out faster GPUs would slow down, imo.

nVidia might feel slighted by this takeover, but for nVidia to stop making it's popular nForce boards for AMD might hurt them, unless they make a deal with intel to help with it's integrated graphics on certain laptops, and help push SLI for intel based CPUs.


I was hoping it wasn't true..
By vtohthree on 7/22/2006 12:33:45 AM , Rating: 5
This can be argued in any direction, but I feel this would hinder the growth of the computer industry. No longer will Nvidia be making good chipsets for AMD(as stated by the CEO, they would lessen support if it was true). On top of that who's to say that AMD will let ATI will still allow chipsets to be made for Intel cpu's....this is just great...

So basically, unless or until other companies muscle their way back in(ie: via), you are pretty much going to have less choices for AMD systems and Intel systems when it comes to chipsets, and and graphics(built in and dual card setups).




RE: I was hoping it wasn't true..
By MonkeyPaw on 7/22/2006 11:22:07 AM , Rating: 2
Well, what choice would nVidia really have? Intel is no better. Look at the Core2 Duo launch, only Intel will have the first chipsets available. I guess AMD wants their own propriatary chipset.

I guess on positive note, AMD might be able to use better process technology on ATI's GPUs. Smaller, faster, cooler?


Great
By IntelUser2000 on 7/22/2006 2:23:12 AM , Rating: 2
One of the last best part of Canada now goes to US, how sad the way things are going.




RE: Great
By thilanliyan on 7/22/2006 3:16:00 AM , Rating: 2
Yeah, i was thinking the same thing...a bit sad if it's true.

And with an INCO/Falconbridge/Teck Cominco merger, our mineral industry is gonna be taken over also.

I thought a strong Canadian dollar would ease this sort of thing.


RE: Great
By Pirks on 7/22/2006 1:41:12 PM , Rating: 1
The sooner the better - I got tired of stupid sales taxes and "free" healthcare. We need more freedom here, and less government intervention into our lives. Go go go USA!


RE: Great
By inthell on 7/22/2006 3:47:53 PM , Rating: 2
Go go go USA! :)


By UNCjigga on 7/22/2006 1:16:42 AM , Rating: 2
Seriously, I'm wondering about this. Nvidia still has a lot of market share amongst the AMD enthusiast crowd, and things aren't so sunny on the Intel side of the fence since Intel is aggressively pushing their own chipsets and soon their own DX10 IGPs. They are definately worried about this.




By UNCjigga on 7/22/2006 1:20:17 AM , Rating: 2
...unless, of course, Intel is ready to make an acquisition of their own...


By GoodRevrnd on 7/22/2006 1:32:15 AM , Rating: 2
Rebirth of Matrox anyone? (snicker)


ATi + Intel
By Worthalter on 7/22/2006 3:06:05 AM , Rating: 2
anyone knows what could happen with ATi IGPs in intel motherboards like D101 ?




RE: ATi + Intel
By DigitalFreak on 7/22/2006 11:14:49 AM , Rating: 2
The moment the merger is complete, they will vaporize...


RE: ATi + Intel
By lethalchronic on 7/22/2006 12:02:51 PM , Rating: 2
Didn't this article mention the disapearance of the ATI chipsets in Intel roadmaps.


Make no sense except...
By cocoviper on 7/22/2006 3:48:27 AM , Rating: 3
This seriously makes no sense except as an information technology acquistion.

All I can come up with is that AMD is looking to acquire something that ATi has rights to (either tech or agreements from intel, or something that AMD must think is worth alot of cash they dont exactly have at the moment).

Otherwise....man 5+ billion can buy you alot of world class engineers and facilities, something AMD has especially been in need of the last 7 years or so (always need the best engineers and we all know they have been capacity limited for a while...but they are building two new fabs...but those fabs cost alot of money. Which brings me back to where I started...dang thats alot of money for something that it really seems like they don't need.

ATi must have an Ace of some kind that AMD wants.




RE: Make no sense except...
By masher2 (blog) on 7/22/2006 1:21:57 PM , Rating: 3
> "Otherwise....man 5+ billion can buy you alot of world class engineers and facilities..."

I'm sure the bulk of the purchase is through stock grants, not cash.


Nothing good can come of this...
By Fox5 on 7/22/2006 10:46:46 AM , Rating: 2
Watch for AMD spinning off ATI again in a year or two, possibly after gutting the company.
BTW, think this will hurt ATI's graphics sales for intel laptops?




RE: Nothing good can come of this...
By GTaudiophile on 7/22/2006 10:57:54 AM , Rating: 2
Well, what's the worst that could happen? ATI and AMD could merge, fail, and both disappear! In 12 months we could be back to an Intel/nVidia only world.


By Locutus465 on 7/22/2006 8:32:40 PM , Rating: 2
Considering the P4 was Intels solution for the futer back before they had serious compitition... Yeah, I'm afraid....


Correction: ATI HQ
By Warren21 on 7/22/2006 12:22:55 PM , Rating: 2
ATI's HQ is not in Thornhill, it's in Markham.




RE: Correction: ATI HQ
By MrDiSante on 7/22/2006 1:07:59 PM , Rating: 2
Uh... Markham and Thornhill overlap... let's make the area north of Steeles (for those of you who live nowhere near Toronto - I aplogoize) into a grid like so:
AB
CD
AB is Richmondhill, CD is Thorhnill, BUT BD is Markham and AC is Vaughan.


RE: Correction: ATI HQ
By Knish on 7/22/2006 5:06:07 PM , Rating: 2
Well, that might be true but ATi still says its Markham:

Canada (ATI Headquarters)
ATI Technologies Inc.
1 Commerce Valley Drive East
Markham, Ontario
Canada L3T 7X6
Tel: 905 882 2600


AMD's acquisition of ATI
By FastEddie on 7/22/2006 3:17:14 PM , Rating: 2
With this acquisition, AMD can seriously challange Intel on on the notebook/portable front, where Intel is seriously lacking decent graphics in the notebook market.




RE: AMD's acquisition of ATI
By NMDante on 7/22/2006 3:34:33 PM , Rating: 2
I don't see how it would help AMD in the notebook/laptop department, since anyone looking for a gaming laptop won't buy one with integrated graphics, but with an upgradable path.

Also, Intel's Core Duo works fine for those who don't game on their laptop, or play mostly Java based games from the 'net.

If anything, it could help AMD get a platform with it's own integrated graphics, but then, it'll be like it is now, so it's not any different.



RE: AMD's acquisition of ATI
By mindless1 on 7/22/2006 5:08:38 PM , Rating: 2
I think you mean traditional integrated graphics as implemented over the last 8 years or so. Before then it was common to have discrete graphics controller and on-board video memory. Inevitably that path will be followed soon to keep laptops and other similar portable devices small, smaller, smallest.

If we saw a trend towards serialized memory buss, there are even more possiblities as satisfying the frame buffer alone might even be done on-die and then a serial path to the additional memory on the mainboard.


Nvidia left out in the cold?
By shamgar03 on 7/22/2006 1:52:47 AM , Rating: 2
In terms of chipsets nvidia seems like they could be in a tight spot considering amd and intel will be making their own chipsets now. Of course I would bet that there will be very few changes in the next few years; I bet AMD and ATI will just share technologies and profits. They will most likely be somewhat separate for a while.




RE: Nvidia left out in the cold?
By mushi799 on 7/22/2006 2:48:43 AM , Rating: 2
not really,

i think most people will still consider nforce as their top chipset when making a PC.


GPUs vs. CPUs
By yyrkoon on 7/23/2006 11:25:12 PM , Rating: 2
It seems alot of you are not even thinking about the fact that GPUs have a higher transistor count, and can be argued to outperform CPUs in a dirrect comparrison (I would imagine it would depend on what type of test). I do not claim to be an Electronics Engineer, however am I the only one here who is thinking that somehow AMD CPUs could benifit from ATI technologies ?

As for nVIdia being the sole GPU left, I think this is just silly, you dont just buy a company for 5.6B, and dump the GPU department, especially, when that GPU department dominates half the gaming industry. Also, companies such as ATI often take care of thier own, and make it part of the contract, that the buyer(s) keep on the majority of employees, and /or keep the company structure intact.

In short, there are alot of things that could happen, but we wont know, until it actually ha




RE: GPUs vs. CPUs
By yyrkoon on 7/23/2006 11:27:53 PM , Rating: 2
happens . . .


By Future Guy on 7/22/2006 11:39:26 AM , Rating: 3
AMD would have to be extremely stupid to stop supporting nVidia (and vice versa). It would be in AMD's best interest to keep support for nVidia.




By OtakuMax on 7/24/2006 4:26:13 AM , Rating: 3
http://patft.uspto.gov/netacgi/nph-Parser?Sect1=PT...

Apparently this is the only patent that AMD ever has for graphics. The filing date of this patent is April 4, 2006. Wonder if this has anything to do with the purchase ;)




By Regs on 7/22/2006 11:24:03 AM , Rating: 2
I'm starting to think they were in better position then we all thought they were.




By lethalchronic on 7/22/2006 12:15:28 PM , Rating: 2
Am I the only one who is interested in the possibilities here?

Sure it's all doom and gloom right now but, no matter how much we post are disagreement of the acquisition, it is either going to happen or not.

I would be much obliged to seeing some positive ideas posted here. I have faith in the readers of DailyTech, I love coming to this site, finding some incredible news and then watch the ideas evolve in the posts. Good Times!




Relax...
By retrospooty on 7/22/2006 12:58:59 PM , Rating: 2
Everyone seems to be taking this too seriously. Life will go on, and innovation will continue.




By Loc13 on 7/22/2006 1:26:56 PM , Rating: 2
xbitlabs ran an article last week about the possible merger of AMD and ATI. It's a bit long but it explains the market situation and discusses the reasons why or why not a merger would happen.

http://www.xbitlabs.com/articles/editorial/display...

enjoy!




So next Intel will purchase NVidia?
By yacoub on 7/22/2006 1:41:28 PM , Rating: 2
Crazier things have happened.




By Fenixgoon on 7/22/2006 4:20:22 PM , Rating: 2
This guy seriously reminds me of Dr Breen from HL2:

http://www.xbitlabs.com/misc/picture/?src=/images/...

sorry for the long link, my html skills are not up to par




I see this as a smart move...
By cscpianoman on 7/22/2006 8:28:30 PM , Rating: 2
I see this as a way for AMD to diversify, which it needs to do or it will get burned in the slumps of CPU sales or competition from Intel. This is an opportunity for AMD to gain revenue from something Intel has been doing for ages, graphics and chipsets. Not only those two, but chips for phones and calculators and little buzzy things that kids play with. If AMD is smart they will keep ATI as it's own entity, otherwise they risk burning bridges with nVidia. In essence there are many opportunities from this purchase (if it makes it past the courts) This to me is no different than conagra buying stocks in caterpillar, it just makes sense to move your assets into multiple markets.




By Davelo on 7/23/2006 1:34:04 PM , Rating: 2
AMD aquires ATI to get integrated GPU technology (to better compete with Intel on oem contracts like Dell) and then sells off the rest. But who do they sell to? Maybe Nvidia, who would like to eliminate competition (like they did with ULi).




Servers
By christ1 on 7/24/2006 3:34:51 AM , Rating: 2
This merger is not about desktop users, but rather the very lucrative server market. Intel makes a killing selling servers that have an Intel processor, Intel graphics, and Intel motherboard. This is what AMD wants.




By Midnight Rambler on 7/25/2006 2:28:44 AM , Rating: 2
This is a huge chunk of debt to incur, considering the purchase price + inherited debt. I'm not sure whether AMD has realised $5B in profits in the whole of their existence (they only broke in to the black, overall, in the past 1-1.5 yrs.) The only upside I see for AMD is in chipsets; a real downside would be ATI card mfg. facilities, although I would have thought that they'd have moved exclusively to contract mfgers. by now.

They'd have been much better served investing that $5B in to additional fab capacity ...




By rushfan2006 on 7/26/2006 1:03:17 PM , Rating: 2
I've always found it interesting, with regards to the Internet, how everyone casts theirself as subject matter expert in whatever the current topic is -- and some, extremely rare occassions the person really is exceptionally knowledgeable on the topic, however more often than people project their opinions as fact and experience. I personally have long suspect the grand majority of folks read a website or two or perhaps a magazine article and that is what makes them "experts" on the topic at hand.

The fact is no self-respecting company is going to just go willy-nilly into a deal of this magnitude let alone worth BILLIONS, with no analysis, planning etc. from professionals with decades of experience.

Obviously AMD has some definite plans in store -- and I think its more than what ANYONE here knows or suspects...I really find it hard to believe that they'd invest and risk so much and not know what they are doing.

In short...leave it to the true experts.




"When an individual makes a copy of a song for himself, I suppose we can say he stole a song." -- Sony BMG attorney Jennifer Pariser

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