In a statement today, AMD confirmed it "has received approval from all necessary authorities to proceed with the acquisition of Xilinx." All that remains now is the minor housekeeping referred to as "customary closing conditions," before the deal is done. The final price of the all-stock deal weighs in at $54 billion at current valuations. The transaction is expected to close on Valentine's Day. That's Monday, Feb 14, to those not au fait with the calendar of romance.
We have been watching AMD's pursuit of Xilinx with interest since the original announcement in October 2020. There was a brief delay to proceedings at the end of last year, but the deal has been relatively plain sailing compared to Nvidia's failed effort to purchase Arm. The final hurdle was successfully taken in stride a month ago.
$35 Billion All Share Deal Now Worth $54 Billion
Thanks to AMD's significant share price appreciation since the all-share deal was announced, it is worth another look at the sums that will be involved in the close. Back in October 2020, we reported on a deal valuation in the region of $35 billion. Xilinx shareholders will be receiving 1.7234 shares of AMD common stock for each share of Xilinx common stock they hold at the closing of the transaction.
This originally equated to $143 per share of Xilinx common stock, but AMD stock at the time was only worth around $85 per share, now it is worth over $130, which is a 53% increase. If we apply this increase to the $35 billion, the deal will, as it closes, cost AMD about $54 billion. This sum makes Xilinx a significantly more expensive acquisition than we could have known or would have expected back in October 2020.
Our readers are very familiar with AMD, it's one of the holy trinity of the PC industry, but many will be less familiar with Xilinx. The soon-to-be-acquired tech company is primarily known for its FPGA chips, which will add an important string to AMD's bow, and is a great complementary technology to fold in alongside its CPUs, GPUs, APUs, and SoCs.
When the deal was first announced, AMD CEO Dr. Lisa Su set out her vision concerning the intended purchase. She said that the acquisition could "establish AMD as the industry's high-performance computing leader." Moreover, she described the future merged entity as "truly a compelling combination that will create significant value for all stakeholders."
Xilinx has worked closely with AMD on multiple previous products, and this looks like it will be a blissful marriage, so tying the knot on Valentine's Day seems rather apt.