Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Politics : Formerly About Advanced Micro Devices -- Ignore unavailable to you. Want to Upgrade?

To: MrBuzz who wrote (30551)	3/31/1998 5:44:00 PM
From: Maverick	Read Replies (2) \| Respond to of 1571929

IBM, NEC, Fujitsu, Motorola are said to be possible investors in AMD SAN FRANCISCO, March 30 (Reuters) - Shares of Advanced Micro Devices Inc. rose Monday after two analysts made positive comments, saying its manufacturing was improving, as well as talk of a potential investor in AMD. Both Dan Niles, a BancAmerica Robertson Stephens analyst and Eric Rothdeutsch of Volpe Brown Whelan made said AMD was getting better yields of its K6 processor, meaning it is getting more good parts to ship to customers. AMD has been having manufacturing problems in recent months. Rothdeutsch also said there are persistent rumors that AMD is talking to several chip makers about a possible investment. Shares of Advanced Micro, based in Sunnyvale, Calif., closed up 1-13/16 to 26-09/16 and were the most active on the New York Stock Exchange. "We continue to hear persistent rumors that a large computer manufacturer is interested in taking a substantial stake, like IBM, NEC, Fujitsu, Motorola," Rothdeutsch said. "We think, if this were true, that IBM would make the most sense." Rothdeutsch said that the rumors are that AMD is looking to sell an approximately 25 percent stake in the company to obtain some much-needed cash. AMD's cash has been drained by its moves to add more manufacturing capacity to address its yield woes. "We have been very candid about the fact that we will have to go out for cash sometime in the second quarter," said Scott Allen, an AMD spokesman. "To hear this doesn't surprise me. Unfortunately, nor is this something I can comment on." A spokesman for International Business Machines Corp could not be reached for comment. AMD and IBM recently announced a manufacturing deal, whereby IBM will make the K6 processor for AMD, as an alternate manufacturing source. "In general, they are in a cash crunch," Rothdeutsch said. "They have a debt service due in May...and a cash infusion would allow it to meet that debt." Rothdeutsch said he raised his rating on AMD Monday to a buy from a neutral rating. Allen confirmed that AMD issued a debt offering over a year ago for $400 million that is due sometime in May. Niles of BancAmerica Robertson Stephens said that, even if AMD is talking to investors about selling a stake, improving manufacturing yields is more important for AMD right now. "AMD has been talking to a lot of people for awhile and I don't see anything imminent," Niles said. "For me, fundamentally their business seems to be running better. Yields are better than I had expected."