AMD Acquires ATi!

[Yoon]

Hot from the press line... AMD BUYS ATI! More details below:


[quote]
AMD confirms ATI acquisition

Chip maker borrows $2.5 billion to 'transform the industry'

By INQUIRER newsdesk: Monday 24 July 2006, 10:15
AMD CONFIRMED its acquisition of ATI this morning, three days after the INQUIRER let the cat out of the bag.

While we doubted the chip-maker could afford to buy out the Canadian graphics chip firm, it turns out CEO Hector Ruiz went cap in hand to his bankers and borrowed a cool $2.5 billion.

Ruiz crowed the deal would "reinvent our industry," as he appeared in New York with ATI CEO Dave Orton. At 4.30AM? No wonder Dave Orton looks a bit tired.

AMD agreed to acquire all of the outstanding common shares of ATI for a combination of $4.2 billion in cash and 57 million shares of AMD common stock, based on the number of shares of ATI common stock outstanding on July 21, 2006.

The total comes to $5.4 billion.

AMD said the deal was 'unanimously approved' by the board of directors of each company, but it is still subject to ATI shareholder approval.

David Orton and Hector Ruiz

AMD said it had obtained a $2.5 billion term loan commitment from Morgan Stanley Senior Funding, Inc. to help it finance the deal which has captured the imagination of industry-watchers everywhere.

David Orton and Hector Ruiz

Crowed Hector: "Bringing these two great companies together will allow us to transcend what we have accomplished as individual businesses and reinvent our industry as the technology leader and partner of choice. We believe AMD and ATI will drive growth and innovation for the entire industry, enabling our partners to create differentiated solutions and empowering our customers to choose what is best for them."

Dave Orton, President and CEO of ATI claimed all of the companies' product lines would benefit. "Joining with AMD will enable us to innovate aggressively on the PC platform, and continue to invest significantly in our consumer business to stay in front of our markets," he reckoned

Orton will join AMD as an executive vice president of the ATI business division, reporting to the AMD office of the CEO, comprising Ruiz and president and chief operating officer Dirk Meyer.

But hundreds of other employees will lose their jobs as the new giant seeks to cut operating expenses by around $75 million by the end of 2007.

The combination of AMD's processor expertise with ATI's 'strengths' in graphics, chipsets and consumer electronics, would result in a "new and more formidable company," the pair claim.

The combined company would have achieved approximately $7.3 billion in total consolidated sales during the last four quarters with a workforce of approximately 15,000 employees, according to the joint statement today.

ATI will pay AMD a termination fee of $162 million should the deal yet founder. The transaction is expected to be completed in the fourth quarter of 2006.

[Yoon]

Well, it looks like the takeover is completed, as if you go to ATi's website (http://www.ati.com/), all the former red color has been replaced with the AMD green color, and there is no sign of any ATi logos on the website. Going to ATi's website also just re-directs the site to http://ati.amd.com. I guess we'll be seeing "AMD" Radeons from now on, instead of ATi.

[Hadvi]

Well, I always thought ATI sucked. Altough I use ATI cards.