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Applied Materials rumoured to want to buy AMD

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April 23, 2007 6:15:49 PM

Applied Materials rumoured to want to buy AMD
http://www.theinquirer.net/default.aspx?article=39110
Tunisia is a-buzz, Daammat
By Charlie Demerjian in Las Vegas: Monday 23 April 2007, 14:45
ONE OF THE HOT rumours floating around is over the sale of AMD. No, not the PE one from last week. This one has Applied Materials (AMAT) buying the firm out. Now, wouldn't that be interesting?
Both AMD and AMAT have denied it vigorously with a confused 'no comment', but we were not expecting anything more. The tie-up makes a bit of snese, and if true, and it is only a rumour right now, it may portend a falling out between AMAT and Intel.
Keep an eye on both companies in the coming weeks, this one has more depth than the usual ones.

Something to watch but i wont hold my breath. :?
April 23, 2007 6:24:09 PM

With what money? :lol:  :lol:  :lol:  :lol: 

http://finance.google.com/finance?q=AMAT

Balance Sheet
Total Current Assets 6,405.59
Total Assets 9,808.00
Total Current Liabilities 2,444.20
Total Liabilities 2,841.29
Total Equity 6,966.71
April 23, 2007 6:32:20 PM

At first glance, they appear to have some balance sheet room to add a few billion in debt. At a market cap of $25B, could be a cash + stock deal.

I'm not too familar with the company, but my understanding is that they had some struggles this year.

Interesting...
Related resources
April 23, 2007 6:42:59 PM

@SIRKILLALOT
It is just another BS from the_INQ.
Don't use it as source of information.

Quote:
With what money? :lol:  :lol:  :lol:  :lol: 

AMAT has 3 times more money than AMD.
April 23, 2007 6:52:51 PM

Quote:
@SIRKILLALOT
It is just another BS from the_INQ.
Don't use it as source of information.

With what money? :lol:  :lol:  :lol:  :lol: 

AMAT has 3 times more money than AMD.

Selling Intel the equipment it needs to make chips is a lucrative business. :) 

If AMAT buys AMD, I would imagine that income would cease to be.
a c 108 à CPUs
a b À AMD
April 23, 2007 7:12:49 PM

Quote:
AMAT has 3 times more money than AMD.
In millions . . .

AMAT
Cash and Equiv 1,068.6
Accts Rec 2,051.6
6,966.7 total equity
Total Liabilities & Equity 9,808.0

AMD
Cash and Equiv 1,380.0
Accts Rec 1,140.0
5,785.0 total equity
Total Liabilities & Equity 13,147
April 23, 2007 7:50:17 PM

Quote:
conflict of interest since they sell machines to INTEL. But definitely one of the buyers on my wish list.


Applied would lose so much bussiness in the industry. I think they make dry etch, litho, planner, diffusion, and some metrology equipment. They would so shoot themselves in the foot doing this. They have real good products and help drive the industry, but nobody wants to feed their competitors and they are not the only game in town.

I never did read the article, it sounds fudish to me though.
April 23, 2007 8:02:23 PM

Quote:
Applied Materials rumoured to want to buy AMD
http://www.theinquirer.net/default.aspx?article=39110
Tunisia is a-buzz, Daammat
By Charlie Demerjian in Las Vegas: Monday 23 April 2007, 14:45
ONE OF THE HOT rumours floating around is over the sale of AMD. No, not the PE one from last week. This one has Applied Materials (AMAT) buying the firm out. Now, wouldn't that be interesting?
Both AMD and AMAT have denied it vigorously with a confused 'no comment', but we were not expecting anything more. The tie-up makes a bit of snese, and if true, and it is only a rumour right now, it may portend a falling out between AMAT and Intel.
Keep an eye on both companies in the coming weeks, this one has more depth than the usual ones.

Something to watch but i wont hold my breath. :?


This is really dumb rumor time, they must be desperate to find a buyer for AMD. AMAt is a top equipment supplier and is not in the business to compete with Intel or owning fabs for that matter!! 8O
April 23, 2007 8:20:04 PM

I hear ya!
well i did say ...
"Something to watch but i wont hold my breath. "
its just 1 rumor of about 4-5 companys buying AMD its just so stupid its funny.
April 23, 2007 8:26:33 PM

Well, I do know a few other fab tool vendors who would love to fill AMAT's shoes if this does happen. Novellus, KLA/Tencor, and Toyoko Electron to name a few.

This would pretty much kill AMAT, since they aren't in the business of making CPUs, GPUs, or anything else like that (that I've heard, anyway), like xpresso mention.

There is no real reason for AMAT to buyout AMD.
April 23, 2007 8:57:09 PM

Quote:
I really despise the inquirer,whos going to buy AMD next?


Rumor has it that Lays is interested. They want to bump the voltage and repackage them as BBQ Chips and sell them by the bag :wink:
April 23, 2007 9:06:11 PM

I don't work at Applied Materials, but I certainly do work with them. I've heard directly from a number of their employees that they're looking at AMD. I don't know anything more than that, but this time the Inq is not full of shit.
April 23, 2007 9:57:39 PM

Quote:
I don't work at Applied Materials, but I certainly do work with them. I've heard directly from a number of their employees that they're looking at AMD. I don't know anything more than that, but this time the Inq is not full of ****.


8O 8O Applied has been my fantasy buyer of AMD since last friggen year. I just cant see it happening with applied selling to Intel, Youll have to be alot more convincing to assert that the fags at the inquirer are right on this. Looking at a company and weighing conflict of interest is two hugely different things.

I just dont see it as feasable to be the competitor to intel and loose equipment sales. Youll have to present something more than, "I have heard"......


Look at HP/VooDoo or Dell/AlienWare. I worked for a company that was bought by MS as a subsidiary.

The real connection in that case is just the balance sheet not the operation of the company.

Like I said in the other post I don't have an opinion but stranger things have happened.

I mean Intel opened their FSB. That's definitely a route for ATi to develop XFire logic.
April 23, 2007 10:48:06 PM

At this point, I actually hope Applied (or someone else) buys AMD out. AMD's leadership is incompetent at best, and someone else needs to take the helm. I would rather not pay double price for Intel products because AMD self-destructed.
April 23, 2007 11:14:24 PM

If a buyout was already in the works, then the convertable note offering wouldn't be going forward. Same deal with the CC where they announced they were "open" to private equity, they wouldn't have done that if a buyout was in the works.

They've got nobody lined up.
a c 108 à CPUs
a b À AMD
April 23, 2007 11:26:57 PM

I would look at AMD/AMAT as more a merger of equals that potentially benefits them both. I don't know what percentage of the AMAT revenue comes directly from Intel - it would be interesting to know . . .

That doesn't mean AMAT could not partner with AMD and leverage or *ramp up* volume production whereby AMD becomes a real player in the OEM market - expanding sustainable market share in a meaningful way.

Intel and their business practices have been called into question before . . . . be a great way for AMAT to give 'em the finger - so to speak - if it is so warranted . . . .

That said, AMD has never been a *cash cow* - depreciation/debt has always run ahead of income. It's always been a *fab struggle* for them . . .

Who knows . . . . the AMAT/AMD roadmap could take k10 to 32 nm in 12 months . . .LOL
a c 471 à CPUs
a c 118 À AMD
a c 115 å Intel
April 23, 2007 11:54:43 PM

As others have stated, I really doubt AMAT will buy out AMD. Sure, it will diversify their product line, but then AMAT/AMD will probably loose a major customer Intel if they do not want to deal with their direct competitor in the CPU and chipset market.

However, I should point out that I've been wrong before regarding the acquisition of ATI last year.
a c 108 à CPUs
a b À AMD
April 24, 2007 12:11:04 AM

Do we know who else does *fab* work for Intel ??? . . . I don't know if could be as much a conflict of interest as **carnivorous capitalism**.

A company with minimal debt (AMAT) needs rapid expansion in a volatile changing market - partnering with a debt heavy company (AMD) who can take the majority of the expansion in a business model that has always been starved of volume.

It makes for an impressive *combined* balance sheet - even with the 'convertibles' - paying down old debt, buying back stock and having enough cash left over for a new fab . . .

And maybe we'll all be using solar-powered AMD-based boxes in 14 months . . . . 8)

edit: I needed to stress the *combined* balance sheets . . . .
April 24, 2007 12:26:16 AM

Quote:
I just dont see it as feasable to be the competitor to intel and loose equipment sales. Youll have to present something more than, "I have heard"......


Maybe you have a reading comprehension problem. I didn't say that my cousin bob had a friend whose uncle once heard a story from a down and out AMAT employee tripping on shrooms. I said Applied Materials employees have directly told me they are interested acquiring AMD.

Many companies sell directly to their competitors. Intel is providing chips for Mac's while they will be directly competing against the Iphone. If AMAT acquired AMD it's not an inevitability that they would stop dealing with Intel. AMAT is already dealing with both Intel and AMD, and neither company seems to care about that fact.
April 24, 2007 12:31:29 AM

More for the rumor mill...

The article I saw was refering to a possible merger , not a buyout...

Quote:
There is an interesting article out today regarding a potential merger where Applied Materials (AMAT-NASDAQ) is reportedly considering a merger with troubled Advanced Micro Devices (AMD-NYSE). This is not just different than prior rumors that private equity may have an interest in AMD. This would be a true game-changer if there is any truth to it, although investors have more reasons to be skeptical than they have to be hopeful.


http://www.247wallst.com/2007/04/can_applied_mat.html
April 24, 2007 12:46:35 AM

Quote:
I just dont see it as feasable to be the competitor to intel and loose equipment sales. Youll have to present something more than, "I have heard"......


Maybe you have a reading comprehension problem. I didn't say that my cousin bob had a friend whose uncle once heard a story from a down and out AMAT employee tripping on shrooms. I said Applied Materials employees have directly told me they are interested acquiring AMD.

Many companies sell directly to their competitors. Intel is providing chips for Mac's while they will be directly competing against the Iphone. If AMAT acquired AMD it's not an inevitability that they would stop dealing with Intel. AMAT is already dealing with both Intel and AMD, and neither company seems to care about that fact.

I think you underestimate how much such an acquisition would affect AMAT's relationship with Intel. Most cases of supply to a competitor don't include two competitor industries. Also, there is a problem with your Apple example. The competitor to the iphone that you speak of will be a Microsoft product using Intel chips. It will also likely contain chips from companies other than Intel. You may not realize this, but there are more handset companies than chip companies available to supply a particular part in the cell phone industry. They have no choice but to use the same suppliers as their competitors.

If Intel has a viable alternative to AMAT for a particular piece of equipment, they will drop AMAT for supply of that equipment if they acquire AMD. They can probably void any contracts due to the obvious conflict of interest at AMAT.
April 24, 2007 3:51:13 AM

Quote:
Like I said in the other post I don't have an opinion but stranger things have happened.

I mean Intel opened their FSB. That's definitely a route for ATi to develop XFire logic.


Equivocating Intel opening their FSB to Applied Materials buying AMD is, for lack of a better term, fcuking stupid.

You don't have an opinion because your common sense (which for some reason you choose to surpress) is telling you it's stupid. Listen to it for a change.
April 24, 2007 5:57:02 AM

So would that make them AMATAMDATI? I don't think they could fit that on a case badge...
April 24, 2007 7:57:41 AM

Quote:
I really despise the inquirer,whos going to buy AMD next?


We, the members of the TomsHardware Forumz will! We'll wait until AMD's stock is at 1 cent and they make a hostile takeover bid! Muahaha! :lol: 
April 24, 2007 8:10:49 AM

Quote:

We, the members of the TomsHardware Forumz will! We'll wait until AMD's stock is at 1 cent and they make a hostile takeover bid! Muahaha! :lol: 


Why? You don't like your Conroes anymore? You hve no use for AMD! (We'll see about that when R600 comes out :lol:  )
April 24, 2007 8:32:58 AM

Quote:
I stand corrected in thinking this was shop talk of business buddies. the amount of data on the net for this rumor is staggering for how fresh it is.
My bad I hope youll accept an apology. :oops: 
2 thumbs up on a merger for these guys. I feel its an awesome idea.


ok, but just this time :mrgreen: cause im a good guy, (like you said b4) no really the funny thing is i worked for a company in australia called "the good guys" so its true lol.
later
April 24, 2007 9:58:52 AM

Quote:

Who knows . . . . the AMAT/AMD roadmap could take k10 to 32 nm in 12 months . . .LOL


AMD does have something that AMAT might want badly and that is APM. Delivering tools with integrated APM or licenting it would give AMAT a good advantage over competing tool companies as it'a a proven technology for improving yields and reducing ramping time.
April 24, 2007 11:18:58 AM

Quote:
:lol:  We, the members of the TomsHardware Forumz will! We'll wait until AMD's stock is at 1 cent and they make a hostile takeover bid! Muahaha!


:lol:  The members of TomsHardware Forumz owning AMD, now that could be interesting. Just make sure that I get a big discount on the R600 after you takeover AMD.
a c 108 à CPUs
a b À AMD
April 24, 2007 11:22:44 AM

Quote:
So would that make them AMATAMDATI? I don't think they could fit that on a case badge...
I think you and Vern may be on to something

AMDAMATATI . . .am -DAM- uh - tat- ee

AMD has never had the cash for promotion. With a merger with AMAT a fancy PR firm could design an Ad campaign on K10, r600, 690 chipset, etc. on the Italian exotic car theme. . .

Driven by *The Greenman Group* ???

They may have to add !!!, though . .

K10 !!!
R600 !!!
a c 108 à CPUs
a b À AMD
April 24, 2007 11:37:07 AM

Quote:

Who knows . . . . the AMAT/AMD roadmap could take k10 to 32 nm in 12 months . . .LOL


AMD does have something that AMAT might want badly and that is APM. Delivering tools with integrated APM or licenting it would give AMAT a good advantage over competing tool companies as it'a a proven technology for improving yields and reducing ramping time.

It's *Win Win* for both AMD & AMAT.

I think it would be very difficult for AMAT competitors to rush in and fill the AMAT *void* with Intel - AMAT is 4-5 times the size of its closest competitor.

They could never *stop* Intel but could help level the playing field beyond 45nm technology.
April 24, 2007 11:54:35 AM

Quote:

Who knows . . . . the AMAT/AMD roadmap could take k10 to 32 nm in 12 months . . .LOL


AMD does have something that AMAT might want badly and that is APM. Delivering tools with integrated APM or licenting it would give AMAT a good advantage over competing tool companies as it'a a proven technology for improving yields and reducing ramping time.

It's *Win Win* for both AMD & AMAT.

I think it would be very difficult for AMAT competitors to rush in and fill the AMAT *void* with Intel - AMAT is 4-5 times the size of its closest competitor.

They could never *stop* Intel but could help level the playing field beyond 45nm technology.

Actualy the situation could be a little triky for Intel too because my guess is that AMAT is among the suppliers for their High K Toolset if not the only supplier.
April 24, 2007 11:58:42 AM

This would make for a very complicated scenario. If AMAT bought out AMD, they would have a huge risk at leaking Intel IP. So, Intel would have to most likely get rid of all of their FSE's (Field Service Engineers) that are contracted by AMAT to maintain their toolsets. That is one scenario that is odd. But another one is if they all of the sudden owned AMD, then they would have acces to all of their competitors tool sets. Since I am sure that AMD uses a wide variety of fab tools as well. I can't imagine the other companies would be real thrilled about that either.

I just wonder how this could happen without having just about every company in the Semi Conductor industry up in arms.
April 24, 2007 12:16:25 PM

Quote:
This would make for a very complicated scenario. If AMAT bought out AMD, they would have a huge risk at leaking Intel IP. So, Intel would have to most likely get rid of all of their FSE's (Field Service Engineers) that are contracted by AMAT to maintain their toolsets. That is one scenario that is odd. But another one is if they all of the sudden owned AMD, then they would have acces to all of their competitors tool sets. Since I am sure that AMD uses a wide variety of fab tools as well. I can't imagine the other companies would be real thrilled about that either.

I just wonder how this could happen without having just about every company in the Semi Conductor industry up in arms.


Well can this be an oportunity for AMAT? I think so, regardeles of the tectonic movements in the industry it might trigger. They cant' buy Intel that's for sure and no other company they can afford seems bring to the game as much as would AMD.
April 24, 2007 12:27:22 PM

Quote:
This would make for a very complicated scenario. If AMAT bought out AMD, they would have a huge risk at leaking Intel IP. So, Intel would have to most likely get rid of all of their FSE's (Field Service Engineers) that are contracted by AMAT to maintain their toolsets. That is one scenario that is odd. But another one is if they all of the sudden owned AMD, then they would have acces to all of their competitors tool sets. Since I am sure that AMD uses a wide variety of fab tools as well. I can't imagine the other companies would be real thrilled about that either.

I just wonder how this could happen without having just about every company in the Semi Conductor industry up in arms.


Well can this be an oportunity for AMAT? I think so, regardeles of the tectonic movements in the industry it might trigger. They cant' buy Intel that's for sure and no other company they can afford seems bring to the game as much as would AMD.

I think it "could" be a big opportunity for AMAT, but I also think that it could be a huge risk. They would spend the money that they have made on a company that is currently losing money. In the process of doing that, they would run a strong risk of killing off the profitablility of their old business of supplying tools to the rest of the community. Obviously, I don't know any of the ins and outs of the situation, but I can see a scenario that would effectively have AMAT jumping on a sinking ship and going down with it.
a c 108 à CPUs
a b À AMD
April 24, 2007 12:35:15 PM

Quote:
It's *Win Win* for both AMD & AMAT.
Quote:
Actualy the situation could be a little triky for Intel too because my guess is that AMAT is among the suppliers for their High K Toolset if not the only supplier.


Great catch! I had not recognized the impact on metal gate . . .
April 24, 2007 1:41:03 PM

This thread should die... the $2.2B debt offering has sealed AMDs fate... they are on their own.
April 30, 2007 3:17:40 PM

Quote:
It's *Win Win* for both AMD & AMAT.
Quote:
Actualy the situation could be a little triky for Intel too because my guess is that AMAT is among the suppliers for their High K Toolset if not the only supplier.


Great catch! I had not recognized the impact on metal gate . . .

. . . as there is none.
!