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AMD Considers Xilinx Buy For $30B

 |  October 12, 2020

AMD is reported to be negotiating to buy Xilinx, and a deal could come as soon as next week. If the two companies agree, the deal would likely be worth approximately US$30 billion, according to The Wall Street Journal.

The value of AMD shares has soared of late, which means it should be able to much more easily swing a deal, and pay largely in stock. The WSJ reported that AMD’s stock grew 89% this year, and the company now has a valuation over US$100 billion. Xilinx, meanwhile, has had to contend with the vicissitudes of President Donald Trump’s trade war with China; it tried and failed to secure a dispensation to keep supplying Huawei.

AMD buying Xilinx would be the second mega-merger announced this year, following Nvidia’s announcement that it intends to buy Arm Holdings for US$40 billion.

The AMD-Xilinx combination is much more reminiscent of Intel’s purchase of Altera in 2015 for approximately US$16.7 billion, however. It would be another instance of a leading provider of CPUs buying a specialist in FPGAs, and for similar reasons, to gain control of a complementary chip technology important in data centers in general, and with artificial intelligence (AI) workloads specifically. FPGAs are often used for AI acceleration.

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