AMD gets a boost.
AMD has been struggling financially thanks to a slowing PC industry. Today, AMD announced that it had secured a loan of half a billion dollars from a group of lenders. Bank of America is acting as agent for the lenders. This secured revolving line of credit will mature five years from now, on November 12, 2018. Speaking in a statement released today, AMD CFO Devinder Kumar said the loan would offer the financial flexibility AMD needs.
"We have made significant progress during the last year strengthening our capital structure to support our strategic growth plans," said Devinder Kumar, AMD senior vice president and chief financial officer. "We expect to end the fourth quarter of 2013 with cash, cash equivalents and marketable securities, including long-term marketable securities, balances of approximately $1.2 billion and remain committed to maintaining ongoing balances of approximately $1.1 billion, our target optimal level. This secured revolving line of credit provides AMD with greater financial flexibility as we continue transforming AMD for growth across a more diverse set of markets."
AMD has, over the last year, made attempts to reduce investments and capital in non-core parts of the business. The company in March entered into a transaction that saw the company sell and lease back its Austin, Texas campus to Southwest Parkway. That deal was said to generate approximately $164 million in cash for the chip maker. Then, in September, AMD did the same with its Singapore facility. That generated proceeds of up to $46 million (net of all fees).
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