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

To: Ted Foster who wrote (54915)	4/9/1999 3:53:00 AM
From: Tenchusatsu	Respond to of 1571673

<There has been some discussion on CPQ boards as to the possibility of CPQ buying or becoming the guardian angel of AMD.> I think the point may have popped up once or twice about AMD becoming a possible takeover target. And who better to take over AMD than Compaq, the OEM who helped drive AMD into the sub-$1000 PC market in the first place? However, there are two reasons why this wouldn't be considered a smart move: 1) AMD is in a very money-losing position right now because of their manufacturing problems. Plus, it doesn't help to have Intel cutting prices drastically in an effort to take back marketshare. Some are banking on the K7 to save AMD's hide, but realistically the profits from the K7 won't come until at least the first quarter of 2000, which is the earliest that the K7 can be produced in sufficient volumes. And finally, because of AMD's continued losses, they've racked up one huge pile of debt. It's hard to see anyone rushing to purchase AMD. 2) Compaq has already been through two acquisitions already, including the Digital acquisition. As Tony Viola put it, Compaq would be crazy to buy yet another company like AMD. It's just way too much for even Compaq to swallow. This is how I understand it, but as usual, I could be wrong. Tenchusatsu