AMD has just announced that it has acquired the manufacturer of FPGAs Xilinx, in a move reminiscent of the one that Intel made five years ago when it acquired the also manufacturer of FPGAs Altera, which gave Gordon Moore’s company a certain position in that market. What are the details of this operation? What does Xilinx bring to AMD and vice versa? Let’s see it all below.
During the presentation of results for the third quarter, AMD has confirmed what had been rumored for days, the acquisition of Xilinx, which makes perfect sense for AMD since Xilinx’s portfolio of technologies is complementary to that of AMD and places the company led by Lisa Su in new markets that you could not access before.
AMD buys Xilinx, these are the numbers
The acquisition has been produced for 35,000 million US dollars, which will be paid to Xilinx shareholders in shares of AMD itself. Under the terms of the agreement, Xilinx shareholders will receive 1.7234 (one point seventy-two) shares or common shares for each Xilinx share they hold at the close of the transaction, which represents $ 143 per share.
Upon completion of the operation, AMD shareholders will own approximately 74% of the combination of both companies, while Xilinx shareholders will own the remaining 26%.
The reasons for AMD’s purchase of Xilinx
Xilinx is not only one of the most important participants in the FPGAs market, but it has developed a series of intellectual properties in different fields that are of interest to AMD for the development of new architectures.
This acquisition is at the level that AMD itself made of ATI Technologies a few years ago because with it AMD can build systems with FPGAs and implement them in its systems, an idea that Lisa Su already dropped during CES 2019.
If the purchase of ATI brought us what was called AMD Fusion in its day and which ended up becoming the AMD APUs or SoCs composed of AMD CPUs and Radeon graphics processor technologies, originally owned by ATI, in the case that We are concerned with the purchase of Xilinx that will translate into integrated circuits of all kinds that will combine the Xilinx FPGAs and their intellectual properties with those of AMD in different ways, either in a monolithic structure or in multi-chip modules.
It will take a while to see the results
Although the Xilinx portfolio is going to be quickly incorporated into that of AMD with its FPGA product range, the result in the form of new architectures that take advantage of Xilinx technology in combination with that of AMD will still take at least two to three years.
However, the success of the AMD Ryzen gives Xilinx a greater reach in the market than it currently has and creates a much better synergy for them than when they were alone. AMD on the other hand seeks to solve its shortcomings when developing new chips, which in certain areas placed them behind other market participants, especially Intel.