AMD is a company that has been strapped for cash lately. In late April, the Sunnyvale, CA based company announced that it would offer
Convertible Senior Notes to raise around $2.2 billion USD. AMD set a conversion
point of $42.12 USD per share at a time when its stock price was $14 USD.
The company's efforts to raise more cash have intensified
even further. Yesterday, AMD priced an additional $1.5 billion USD in
Convertible Senior Notes at a conversion point of $20.13 USD per share. The
conversion price represents a 50 percent premium over AMD's $13.42 USD stock price
at close of day on August 8.
AMD plans to use the funds received from the offering to pay an outstanding
balance on a loan from Morgan Stanley Senior Funding in late 2006. The company
borrowed around $2.5 billion USD in loans and $1.2 billion USD in common stock
to fund the $5.4
billion purchase of ATI Technologies. The company also reported a net loss of $600
million USD last quarter while archrival Intel
reported net income of $1.3 billion USD.
quote: With questions about the long term viability over the ATI acquisition, and the huge debt it engendered, AMD's current problems are its own responsibility.To blame any long term business failures of AMD, on possible, as yet unproved, misadventures of Intel, has no bearing on AMD's current precarious position.
quote: but if Fusion,Torrenza and CTM play out good... they may end up with much reasons to celebrate.