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Technology Stocks : Advanced Micro Devices - Moderated (AMD) -- Ignore unavailable to you. Want to Upgrade?

To: aleph0 who wrote (219979)	12/11/2006 6:22:36 AM
From: drjohn	Read Replies (1) \| Respond to of 275872

Conjecture; AMD knows K8L is at best only at par with Core2 duo and they need a new plan/Model/Gimmick; AMD realised they where at thier strongest in the spring it was then or never. ATI knew thier stock would go nowhere for at least 18 months because Nvidea will be cleaning thier clock, someone offered them a 40% premium most of the ATI shareholder were glad to take the money and run(I was one of them). The ATI board could justify the offer because of the premium and assurances of no initial job loses which made approval by Canadian authorities easy. ATI founders where under scrutiny for years for selling prior to poor earnings I am sure they where happy to take the money and run.

To: aleph0 who wrote (219979)	12/11/2006 6:23:30 AM
From: Pravin Kamdar	Respond to of 275872

aleph0, Does anyone have any ideas on "Why" ? If you buy something, you own it. If you merge with something, it partially owns you. It's about who remains in control. Pravin.

To: aleph0 who wrote (219979)	12/11/2006 9:37:37 AM
From: Dinesh	Respond to of 275872

You take a position that AMD had the choice to go either acquisition or merger route at the same cost to AMD shareholders. It is also possible that ATYT wanted to pick up the cash and leave scene asap. Or, the cost of equity financing would have worked out comparatively higher. Acquisition has its own charm, particularly in its speed of execution, and less bickering over 3rd-party contract renegotiations, relative asset valuations, etc. Given what has actually happened, and assuming that these guys know a thing or two about M&A, what can we surmise? Lets put on our Bayes' hats and try to make some educated guesses - and I will start with these 2 (although not very educated ones.) (1) AMD may not have wanted to dilute at < $21. Do they know something that others may not? It appears that this price has since then become a floor, meaning while people may not buy AMD's story, they also may not want to bet against it. (2) AMD may have wanted to speed up the integration? Are they working on something jointly that truly requires such high level of integration? My speculation is that, for the moment, the innovation is shifting gears and moving to applications domain for the moment - video & graphics, communications, gaming, etc. That the X86 may be heading to become a staple and that the profits and the multiples will come from applications. regards -d