AMD the subject of takeover rumors by Chinese firm

[cirr]

AMD the subject of takeover rumors by Chinese firm

Any deal would be very complicated due to licensing and IP ownership.

ITworld | January 26, 2015

AMD started the week as the subject of takeover rumors by a Chinese firm, but others caution that any deal would be extremely difficult at best. The report first appeared on the Chinese news site International Online, which said that the Chinese firm BLX IC Design was interested in acquiring the struggling firm.

China's Institute of Computing Technology, Academy of Sciences and Jiangsu Zhongyi Group established BLX in 2002 and the company is one of the leading fabless microprocessor design companies in China. Its flagship semiconductor is the Godson ship, a MIPS-like processor for embedded devices.

BLX and AMD are not strangers. The two opened the AMD/BLX Computing Client Development Center in Beijing in December 2013. Products designed by the two were aimed at thing client computing solutions in the China region.

AMD has had it rough lately. It fell short of earnings projections and its guidance was not good. Both CPU and GPU sales were down and it has been losing ground to Intel and Nvidia. It recently appointed a new CEO and several senior executives have left.

However, such a deal would face quite a few hurdles. The site Benzinga.com featured some really good points from Bernstein analyst Stacy A. Rasgon, who did not think that "Lisa Su’s first task as CEO would be to sell the company."

Rasgon also noted that Intel's x86 cross-license IP deal with AMD "does not transfer under a change of control," so BLX would have to renegotiate a new license with Intel. Given the Chinese government pretty much owns BLX, that would probably not go over very well with Intel or the U.S. government.

And AMD is hardly a sovereign company these days. The Mubadala Development Company of Abu Dhabi is the largest stakeholder in AMD, with 18.3% of company shares. So in addition to dealing with the U.S. government and Intel, BLX will have to work things out with Abu Dhabi. If it does pursue the deal, BLX will have a lot of work to do.

I agree with Rasgon that Su didn't become CEO to sell the company. Rory Read might have done it after failing to turn the company around, but Su is a respected veteran at the company and she has stated a plan to rebuild the company around a new strategy. But she also wouldn't turn down a good offer, either.

 

[C130]

I've been a AMD fanboy since 2008, but now I dunno.
good value, but Intel/Nvidia just killing it nowadays.
don't think even China could save AMD in the short term.

 

[powastick]

I expect the US would block the deal if it was true.

 

[Beast]

I've been a AMD fanboy since 2008, but now I dunno.
good value, but Intel/Nvidia just killing it nowadays.
don't think even China could save AMD in the short term.

Lenovo and other Chinese companies will use more AMD once acquired. They have a game plan.

I expect the US would block the deal if it was true.

Then another US company will go down in history.

 

[C130]

Lenovo and other Chinese companies will use more AMD once acquired. They have a game plan.


Then another US company will go down in history.

why would lenovo just use AMD if China buys AMD?? that makes no sense.

and i don't consider AMD really American......how many America people do AMD have on payroll??? besides the fat cats.

 

[TaiShang]

They will not sell it if not in deep trouble. Either accept China's helping hand, or find another buyer, or face bankruptcy.

The sides might seek an arrangement that would not include lntel lP.

 

[cnleio]

If Chinese IT company wanna beat Intel in the future, today buy AMD first and learn X86 core tech from mature AMD CPU.

Even cost 10billion USD, this's a very rare chance to boost the development of Chinese chipset industry. The only problem is, how to convince U.S.Congress to allow this deal.

Chinese produce Mainboard, Harddisk, Cooler, DVD, DDR, LCD ... now only lack mature CPU design ... if China government smart enough, we should buy AMD and his whole 32/64bits CPU/GPU techs.

 

[BoQ77]

I still have a desktop with AMD Athlon X2 CPU, that working well,
but I rarely use it.

 

[sword1947]

why would lenovo just use AMD if China buys AMD?? that makes no sense.

and i don't consider AMD really American......how many America people do AMD have on payroll??? besides the fat cats.

You know, parents always give unprincipled protection to their child

 

[jamahir]

amd is a rubbish company that has no original idea... it would be wrong of a chinese company in taking over amd, unless it is only to buy it and shut it down.

better is china design their own microprocessor, and not depends on mips architecture or x86.

 

[jhungary]

dont think US government will sell AMD, as they consider AMD major IT contributor to US government.

Plus x86 patent is too big to transfer, even if US is willing to sell, dont think Chinese can take it.

 

[jamahir]

dont think US government will sell AMD, as they consider AMD major IT contributor to US government.

Plus x86 patent is too big to transfer, even if US is willing to sell, dont think Chinese can take it.

too big to transfer?? beyond the lawyer-speak, it is just instruction set and memory layout and i/o system.

 

[sword1947]

amd is a rubbish company that has no original idea... it would be wrong of a chinese company in taking over amd, unless it is only to buy it and shut it down.

better is china design their own microprocessor, and not depends on mips architecture or x86.

If they really sell AMD to China, with our investment & market, we can save them. buy AMD will save a lot of time for developing Chinese microchip, really a good deal for China

 

[TaiShang]

I guess the proposed transaction is a better option than let the firm go down and end up with a market monopoly. I know US government does not like monopolies.

 

[jhungary]

too big to transfer?? beyond the lawyer-speak, it is just instruction set and memory layout and i/o system.

x86 is a TOO BIG A SECRET to transfer.....

dude, US government listed both x86 chipset core tech and TCPIP protocol as Top Secret, unless China can pass an NSA vetting, or somehow China can acquire AMD Without x86 chipset blueprint, they are not gonna get AMD...

I guess the proposed transaction is a better option than let the firm go down and end up with a market monopoly. I know US government does not like monopolies.

they may ask other giant to buy it, such as Microsoft..