Update: AMD’s Acquisition of Xilinx Receives Regulatory Go, Deal Closes At $49B
by Ryan Smith on February 14, 2022 9:30 AM EST
Update 02/14: AMD has sent out a brief statement this morning announcing that the Xilinx deal has formally closed. AMD has now fully acquired Xilinx. The final value of the deal, based on AMD's stock price at the closing, was $49B. Which according to AMD is the largest semiconductor acquisition in history.
Original Story, 02/10:
Although it’s taken a bit longer than planned, AMD’s acquisition of Xilinx has finally cleared the last regulatory hurdles. With the expiration of the mandatory HSR waiting period in the United States, AMD and Xilinx now have all of the necessary regulatory approval to close the deal, and AMD expects to complete its roughly $53 billion acquisition of the FPGA maker on or around February 14th, 2 business days from now.
Having previously received approval from Chinese regulators late last month, the final step in AMD’s acquisition of Xilinx has been waiting out the mandatory Hart-Scott-Rodino (HSR) Act waiting period, which gives US regulators time to review the deal, and take more action if necessary. That waiting period ended yesterday, February 9th, with no action taken by the US, meaning that the US will not be moving to block the deal, and giving AMD and Xilinx the green light to close on it.
With all the necessary approvals acquired, AMD and Xilinx are now moving quickly to finally consummate the acquisition. AMD expects to complete that process in two more business days, putting the closure of the deal on (or around) February 14th – which is fittingly enough Valentine’s Day.
16 months in the making, AMD’s acquisition of Xilinx is the biggest acquisition ever for the Texas-based company. The all-stock transaction was valued at $35 billion at the time the deal was announced, offering 1.7234 shares of AMD stock for each Xilinx share. Since then, AMD’s stock price has increased by almost 51% to $125/share, which will put the final price tag on the deal at close to $53 billion – which is almost a third of AMD’s entire market capitalization and underscores the importance of this deal to AMD. Once the deal closes, Xilinx’s current stockholders will find themselves owning roughly 26% of AMD, while AMD’s existing stockholders hold the remaining 74%.
Having rebounded from their darkest days last decade, AMD has since shifted into looking at how to further grow the company, both by increasing its market share in its traditional products like CPUs and GPUs, as well as by expanding into new markets entirely. In particular, AMD has turned its eye towards expanding their presence in the data center market, which has seen strong and sustained growth for virtually everyone involved.
With AMD’s recent growth in the enterprise space with its Zen-based EPYC processor lines, a natural evolution one might conclude would be synergizing high-performance compute with adaptable logic under one roof, which is precisely the conclusion that Intel also came to several years ago. To that end, the high-performance FPGA markets, as well as SmartNICs, adaptive SoCs, and other controllable logic driven by FPGAs represent a promising avenue for future growth for AMD – and one they were willing to pay significantly for.
Overall, this marks the second major industry acquisition to be resolved this week. While NVIDIA’s takeover of Arm was shut down, AMD’s acquisition of Xilinx will close out the week on a happier ending. Ultimately, both deals underscore just how lucrative the market is for data center-class processors, and to what lengths chipmakers will go to secure a piece of that growing market.
Source: AMD IR
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ballsystemlord - Thursday, February 10, 2022 - link
Interesting times ahead. Will Xilinx get the Radeon treatment? (Re-releasing the previous gen again and again.)Or will AMD provide Xilinx with decent funding and management?
Makaveli - Thursday, February 10, 2022 - link
I think Xilinx will keep its current management in place the question of money is the big one. Xilinx on its own is a very profitable business I don't see AMD screwing that up to be cheap with R&D!Shorty_ - Thursday, February 10, 2022 - link
I think it's important to understand why AMD did that in context. With Polaris etc, they had no money. They were trying to scrimp and scrape and borrow so they could get Zen out the door. Once they did that obviously their fortunes changed. Now they're facing fab constraints so sweating old fab allocations etc makes perfect sense.It's also worth mentioning that RTG has always struggled for marketshare, so for a company rebounding from the brink of going under, you can see why they might prioritise other things.
Oxford Guy - Friday, February 11, 2022 - link
AMD designed ‘Polaris Forever’ to keep its Jaguar-peddling ‘console’ friends happy. It didn’t need to improve IPC one iota over Fiji for Vega because of mining demand. Look at how much Vega has been still going for.The narrative that AMD couldn’t make better cards for PC gaming enthusiasts and get them into their hands for reasonable prices being about the company not being able to afford the R&D is mainly fiction.
The facts clearly show AMD had multiple stronger incentives to do things how it did them because maximizing margin is the goal of a corporation — not providing the public service of social enrichment.
The other fact is that as long as there isn’t a single GPU company that puts enthusiast PC gaming customers first, they will get a bad deal. Being forced to buy from a duopoly where the choices are worse and worser is a recipe for continual disappointment. Einstein said insanity is expecting things to change when the variables remain the same.
Excuses for the situation receive more energy expenditure than work to remedy it. This is because there are two-three companies standing to make bank whilst doing the least possible — the goal of every serious megacorp.
The ‘console’ scam is the fault of consumer ignorance but also a lack of adequate anti-trust regulation. It’s interesting to see the great concern over Nvidia getting ARM but the utter opposite treatment of AMD when it comes to how it directly competes against the legitimate PC gaming platform (as opposed to the ‘consoles’ which are the same thing duplicated to extract more out of people than they should pay).
Abort-Retry-Fail - Friday, February 11, 2022 - link
Do you want some cheese to go with your sour grapes whine?
Qasar - Friday, February 11, 2022 - link
oh crap, this is console scam total BS again... oxford guy, either POST SOME PROOF OF THIS CRAP, or shut up about it already. EVERY post you make that contains mention of this scam, is 100% your personal option, NOTHING MORE.honestly, i cant tell if this guy just HATES amd to no end, or, jsut hates the WORLD to no end.
he NEEDS more then just cheese to go with his wine......................
mode_13h - Saturday, February 12, 2022 - link
LOL. In spite of my skepticism of OG's Britishness, I'll concede that he sure whines like a Brit.We had a British guy at a previous job and ended up nicknaming him Whiny. Most of what he said was some form of complaint.
Oxford Guy - Saturday, February 12, 2022 - link
More ad hom from mode, with elementary school name-calling. Keep impressing.Oxford Guy - Saturday, February 12, 2022 - link
Do you expect anyone to read posts like that? The sad caps screeching can be seen without even having to wade through any of the muck.Oxford Guy - Saturday, February 12, 2022 - link
‘Do you want some cheese to go with your sour grapes whine?’How about intelligent comments?