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AMD is in talks to buy Xilinx for $ 30 billion. The deal should be announced next week
NVIDIA’s Arm takeover remains the largest announced this year, but AMD-Xilinx’s deal could be next up with an estimated $ 30 billion budget. The Wall Street Journal reports on the ongoing negotiations between the companies, and AMD may announce the purchase of Xilinx as early as next week.
Image source: Reuters
Since the beginning of this year, AMD shares have risen in price by 89%, the value of the company’s capitalization now exceeds $ 100 billion. The amount of free funds that the company could, if necessary, use to purchase the necessary assets and technologies is also growing. According to The Wall Street Journal, negotiations between AMD and Xilinx recently resumed after a long hiatus on the possibility of the latter taking control of the former. The deal could be announced next week.
Xilinx is the main competitor of Altera, acquired by Intel in 2021, which also developed programmable arrays (FPGA). The demand for them is growing steadily nowadays, since they are used not only in telecommunications equipment of a new generation, but also in autopilot systems in transport. At least in the early stages of prototyping and experimentation, programmable matrices are beneficial because of their functional flexibility and versatility.
FPGAs are also used in the defense sector, although AMD in this sense is already a long-standing supplier of military components, and therefore this market segment will not be new for it if Xilinx is purchased. The capitalization of the last of the companies reaches $ 26 billion, therefore, subject to the payment of a standard premium, the buyer will be able to count on the amount of at least $ 30 billion. Of course, AMD does not have such funds in free form, and it will pay for the deal with its shares and attracted capital. While this idea is being discussed only at the level of rumors, you need to wait for next week or some public comments from stakeholders.