As they say in sport, AMD wants to enjoy a great time… a situation that the company hasn’t experienced for years.
Indeed, AMD’s market position and the spotlight in current events make the company shine on the stock exchange. Capitalization has increased by 89% this year, despite the crisis, and now exceeds 100 billion dollars. It is precisely by taking advantage of this opportunity that the group led by Lisa Su could offer itself Xilinx for 30 billion dollars. The deal would then be paid for in shares, valued at the highest value at the moment.
By targeting Xilink, AMD’s idea is to strengthen its presence in the server market and to gain a foothold in the very lucrative and promising FPGA (Field Programmable Gate Arrays) sector. But it should also be noted that with this acquisition, AMD would have an extremely broad catalogue of technologies on the market: x86 and ARM licensed processors, GPUs, GPU-based scalar computing processors, semi-customized SoCs, low-power multimedia processors and, to complete the picture, FPGAs.
This is a way of putting even more pressure on Intel, which had got its hands on the other major player in FPGA chips, Altera, in 2015.
In addition to the many possible applications for FPGAs, they are mainly found in 5G architectures. And it is obvious this sector that makes analysts salivate.
Handicapped recently by the American sanctions against Huawei, which prevented its Chinese customer from placing an order with it, Xilinx is in a weak position making the operation feasible for AMD.
However, many analysts believe that this deal will not go ahead. The “bonus” offered by AMD for the buyout (20% above the value of Xilinx) does not seem sufficient. Finally, the synergies seem very weak considering the structure of the two companies.
Despite everything, it is interesting to note the strong movements which have shaken the main players in the technology sector in recent months. Additional indicators that hopefully bode well for the future.