AMD has hired JPMorgan to "explore options"

[Phynaz]

http://allthingsd.com/20121113/amd-exploring-options-including-breakup-sale/

There's the hammer for the nails.

 

[A5]

I have to think the GPU business will see far more interest than the CPU business.

 

[Qianglong]

So at first consulting firms and now bankers? The stars are starting to align themselves...

 

[Ferzerp]

I'm sure this thread will attract a (small but omnipresent) flock of folks who will say this is exciting and good news for AMD...

 

[RussianSensation]

That's basically AMD admitting they don't have sufficient funds on their own to carry through with their future growth strategy. The worst thing that could happen now is consumers get nervous that AMD will go bankrupt, stop buying their products, resulting in a self-fulfilling prophecy. The company is running into a cash crunch. With a market value of about $1.4 billion, it also has long-term debt and capital lease obligations of about $2 billion.

Also, once JPMorgan steps in, and AMD's operations could be disrupted as management is unlikely to spend money on current projects or be as focused on working on projects if they feel the company is going to be split apart, or its patent portfolios are purchased and the firm is wound down like Nortel.

I guess all those people who called AMD's buyout of ATI the worst possible move for both companies will be validated, but in the process we will end up with Intel/NV and essentially no competition in the PC enthusiast market segment unless those firms are split up. Even if someone buys AMD, will Intel be willing to renegotiate the x86 license?

 

[ShintaiDK]

Only ATI and SeaMicro to spinoff. Else there is nothing.

I dont see a way out of going bankrupt. Its just a matter of if ATI and SeaMicro will be in the wagon or not when it crashes.

Even if someone buys AMD, will Intel be willing to renegotiate the x86 license?

I dont think there is anyone out there who would be dumb enough to want (by free will) to compete with Intel in the x86 space. Even AMD gave that up.

Not to mention AMD is full of bad luggage. Either you spinoff somewhat healthy parts now, or it will all be sold on discount when bankrupt. The insurance rate on AMDs bonds for default are what now, 18%?

 

[KompuKare]

I have to think the GPU business will see far more interest than the CPU business.

Well yes, but they paid $5 billion for it and since then they haven't been able to put any money in so the amount of R&D which ATI has been able to do since then was always limited. Sure, AMD forced ATI to make parts they can use for Fusion but aside form hurting ATI (GNC while good is transistor heavy for a company which has next to no GPU-Compute market), has AMD put anything into the GPU products?

Unsure if the 5000 series + memory controllers had AMD input but that might be the only thing. Also, it was AMD who sold of Adreno and never tried to go anywhere with the TV stuff (AiW etc.) where ATI was at one stage the leader.

Unsure what plans ATI had at the time of merger of GPU-Compute but due the having to focus on AMD's vision of Fusion with a small R&D budget, ATI was never able to move that way. 5-6 years to get to Trinity was just way to slow IMO. (Having said that, Intel did take 8 years for Phi.)

 

[Qianglong]

Here is AMD's official response to the Register:

Soon after we clicked Publish on this story, we received a comment from an AMD spokesman. "AMD's board and management believe that the strategy the company is currently pursuing to drive long-term growth by leveraging AMD's highly-differentiated technology assets is the right approach to enhance shareholder value," he wrote. "AMD is not actively pursuing a sale of the company or significant assets at this time."

 

[sontin]

ATi is wortless. AMD is losing ground to nVidia with GCN:
Lost the notebook market (accelerate thx to Llano and Trinity), needs much lower prices for the desktop chips, no market share in the workstation and server.

I don't think anybody want to go against nVidia and their IP portfolio.

 

[RussianSensation]

If they spin-off ATI's graphics division, their entire x86 CPU strategy is finished immediately since they bet the marbles on the APU** If they spin-off SeaMicro, that goes against their recently announced strategy for having a "special" fiber that allows them to connect X86 CPUs and ARM for servers** So what was the point of buying SeaMicro in the first place?

To me it smells like they are preparing the company for bankruptcy and trying to find buyers for anything that can be sold to any prospective buyers** When you start looking at selling portfolios and patents, that's Nortel style liquidation** Of course so far it's just a rumor until we hear more official info**

 

[eternalone]

Chinese company needs to come through and Buy AMD.

 

[Qianglong]

Chinese company needs to come through and Buy AMD.

That might be a problem but ATIC and mubadala can increase stake, inject more cash etc...

http://www.youtube.com/watch?feature=player_embedded&v=zQJ00ZzHyNc

 

[RussianSensation]

ATi is wortless. AMD is losing ground to nVidia with GCN:

It's not worthless for us consumers/gamers. HD4000-7000 series delivered amazing price/performance and HD7000 series delivered class leading overclocking and top single-GPU performance. Even if you'll never purchase a single AMD graphics card, ATi/AMD graphics makes sure that NV innovates, pushes themselves to improve performance/watt and keeps prices in check. Considering NV didn't even drop prices this generation, if AMD graphics disappears, it would be price gouging galore in the graphics world. As I said earlier, people are too quick to forget 8800GTX, GTX280 pricing. I mean maybe NV shareholders would love to pay $650+ for a GPU but us gamers certainly don't.

 

[KingFatty]

I would be interested in a hugely discounted 79XX card this black friday. Even if AMD stops existing and drivers are frozen at their current state, if the price is good, I'd still be willing to use that card on current/previous games. But I doubt it would come to that, so I bet the cards remain somewhat expensive.

 

[videogames101]

and thats the game folks!

 

[Vesku]

I don't think selling off pieces would be gaining shareholders much value, if they sell off their graphics division it cripples the rest of the company. They can't sell the x86 assets. Selling Seamicro would be a repeat of selling Imageon to Qualcomm, imo.

This leads me to guess they are looking at ways to entice some direct investment or licensing income. Also attempting to appease shareholders and the BoD that they are doing "something" to shore up the stock price.

 

[mrmt]

Only ATI and SeaMicro to spinoff. Else there is nothing

I doubt that ATI is a viable asset on its own.

ATI generates about 1.4 billion in revenues per year, less than half of what Nvidia generates and mostly on the dGPU market, a market that was shrinking until this quarter. Plus once ATI is spun off AMD would have to pay royalties to ATI on each APU they sell, further worsening the cash crunch AMD is experiencing. So I think ATI's fate is, for the good and bad things, tied with AMD's.

Seamicro is another history, but a year inside a cash strapped company might have killed some R&D there.

 

[mrmt]

I don't think selling off pieces would be gaining shareholders much value, if they sell off their graphics division it cripples the rest of the company. They can't sell the x86 assets.

They should be trying to do something with their patent portfolio, whatever CPU IP not related to x86 or derived from Intel IP, or their GPU IP.

Selling Seamicro would be a repeat of selling Imageon to Qualcomm, imo.

Selling Imageon to Qualcomm at the time was a strategic decision only if you think that AMD could have changed directions at the time. Without selling Imageon but don't investing on it would mean that AMD would have an insignificant stake at the market.

Selling Seamicro today might be a good option. What's the point of keeping Seamicro inside the company if they don't have the necessary money to develop the new business?

 

[Centauri]

I would be interested in a hugely discounted 79XX card this black friday. Even if AMD stops existing and drivers are frozen at their current state, if the price is good, I'd still be willing to use that card on current/previous games. But I doubt it would come to that, so I bet the cards remain somewhat expensive.

You have no idea what you just read in this article, do you?

 

[podspi]

Here is AMD's official response to the Register:

Soon after we clicked Publish on this story, we received a comment from an AMD spokesman. "AMD's board and management believe that the strategy the company is currently pursuing to drive long-term growth by leveraging AMD's highly-differentiated technology assets is the right approach to enhance shareholder value," he wrote. "AMD is not actively pursuing a sale of the company or significant assets at this time."

Ugh. The second a company starts denying it is doing something, it usually is doing something

If they spin-off ATI's graphics division, their entire x86 CPU strategy is finished immediately since they be the marbles on the APU. If they spin-off SeaMicro, that goes against their recently announced strategy for having a "special" fiber that allows them to connect X86 CPUs and ARM for servers. So what was the point of buying SeaMicro in the first place?

To me it smells like they are preparing the company for bankruptcy and trying to find buyers for anything that can be sold to any prospective buyers. When you start looking at selling portfolios and patents, that's Nortel style liquidation. Of course so far it's just a rumor until we hear more official info.

It would really bring into question the logic of purchasing the company in the first place if they spin it right back off so quickly. It is hard to see how AMD is going to carry out their plans without SeaMicro or ATI. I suppose they could spin them off with co-R&D agreements, etc.


Of course, with HSA wasn't the idea you could integrate anybody's IP into an APU? Maybe they really do want to become a design shop. This news really makes me question how much of their roadmap at this point is actually going to happen...

 

[spaceman]

dont blame me i aint bought an intel chip since p3 450 in 1999
and i wont

 

[Arachnotronic]

Faaake....

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[boxleitnerb]

So what are they hiring a bank for, then? What exactly could it help AMD with?

 

[Phynaz]

Faaake********

link removed

Read AMD's reply** They didn't say they haven't hired JPMorgan to explore options******They said they are not activly pursuing the sale of the company** Which they aren't**** JPMorgan could be doing it for them**

 

[RussianSensation]

So what are they hiring a bank for, then? What exactly could it help AMD with?

Could be to secure a line of credit facility since they are cash strapped?