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IBM Takeover of AMD Speculations Arise
IBM Takeover of AMD Speculations Arise Speculations that microchip maker AMD might be bought by IBM surfaced the last couple of days, rising AMD's stock shares by 8% yesterday. Neither parties have commented on the rumour, which however proved to be enough to offer AMD's share a a significant boost. At the same time, IBM's stock was down yesterday by 1.7 percent on the New York Stock Exchange. Some analysts have predicted that with AMD shares being so low, it might be a good time for IBM to acquire them. IBM has had a research and development expense-sharing agreement with AMD. AMD might want to use IBM's East Fishkill, New York, chip-fabrication plant to build microprocessors, in an effort to stengthen its position against rival Intel, who currently has 12 chipmaking plants across the globe, compared to AMD's single chip fabrication plant in Germany. On the other hand, IBM's recent policy to move away from hardware and manufacturing and moving to software and solutions, make the acquisition a low-probability event. IBM sold its computer hard disk business to Hitachi in 2002 and its PC business to China's Lenovo Group in 2005. Last year, IBM sold its printer business to Japan's Ricoh. Earlier Wednesday, IBM said it was buying privately held AptSoft Corp to expand its business event processing software portfolio. Mergermarket.com, a mergers-focused news service, reported on the Financial Times' Web site that IBM and AMD could strengthen their current partnership. "A deal could see IBM's microelectronics division merge with AMD at some point, possibly in the near term," mergermarket.com correspondent David Zielenziger wrote, citing "industry sources." http://www.cdrinfo.com/Sections/News...x?NewsId=22347 By Philipp Gollner and Duncan Martell SAN FRANCISCO (Reuters) - Advanced Micro Devices shares rose as much as 8 percent on Wednesday on speculation that the microchip maker might be bought by IBM, but analysts said the chances of an acquisition were slim. Spokesmen for IBM and AMD, based in Sunnyvale, California, declined to comment on the rumor. Shares of AMD, the second-largest maker of microprocessors after Intel Corp , added as much as 55 cents to $7.39 and were up 23 cents or 3.4 percent at $7.07 in afternoon trading. International Business Machines Corp stock was down $1.73 or 1.7 percent at $99.58 on the New York Stock Exchange. "The takeover of AMD by IBM has been mentioned before and with AMD shares being so low, it might be a good time for IBM to acquire them," said William Lefkowitz, options strategist at brokerage firm vFinance Investments in New York. AMD call options were trading higher than usual because of the rumor, he added. IBM of Armonk, New York, has had a research and development expense- sharing agreement with AMD, and analysts have speculated that AMD might want to use IBM's East Fishkill, New York, chip-fabrication plant to build microprocessors. An acquisition of AMD would be "a pretty low-probability event because IBM is moving away from hardware and manufacturing and moving to software and solutions," said Ashok Kumar, an analyst at CRT Capital Group. "I don't think IBM wants the bragging rights to go up against Intel." "IBM buying AMD is a nonstarter," Kumar said. "There's no rationale for that. Investors would just pound IBM's stock." IBM has been exiting computer hardware businesses to focus on higher- profit software and technology services tailored to clients. Earlier Wednesday, IBM said it was buying privately held AptSoft Corp to expand its business event processing software portfolio. Revenue from IBM's microelectronics business fell 15 percent in the fourth quarter. The unit mainly supplies chips to run IBM's mainframe computers and business server machines. IBM sold its computer disk-drive business to Hitachi Ltd in 2002 and its personal-computer business to China's Lenovo Group Ltd in 2005. Last year, IBM sold its printer business to Japan's Ricoh Co Ltd (7752.T: Quote, Profile, Research). An acquisition of AMD would "destroy shareholder value for IBM," Kumar said. "That argument is a nonstarter." AMD has said it would give details of its "asset-light" manufacturing strategy sometime this year. AMD currently has a chip fabrication plant, or fab, in Germany and has plans to build another one outside Albany, New York. Intel, by comparison, has some 12 chipmaking plants across the globe, and its manufacturing prowess has long been a competitive advantage against smaller rival AMD. Mergermarket.com, a mergers-focused news service, reported on the Financial Times' Web site that IBM and AMD could strengthen their current partnership. "A deal could see IBM's microelectronics division merge with AMD at some point, possibly in the near term," mergermarket.com correspondent David Zielenziger wrote, citing "industry sources." http://www.reuters.com/article/hotSt...41197920080123 Newest Reuters wire claims IBM is considering a purchase of struggling AMD Few will argue that AMD's image and profitability are not what they used to be. AMD was having issues prior to its purchase of graphics maker ATI and things have only worsened since the ATI purchase. DailyTech reported last week that AMD posted a massive loss for Q4 2007 of $1.72 billion while rival Intel posted significant profits across its operations. Between new architectures and aggressive pricing, a shakeup in the microprocessor arena is almost certain for 2008. Reuters now reports IBM is possibly considering a buyout of floundering AMD and some say this would be an ideal time for the buyout with AMD stock prices at a low. IBM and AMD currently have a research and development expense-sharing deal in place. This is not the first time rumors of an IBM buyout of AMD have circulated. Other companies have their eye on AMD as well. Texas Instruments and Freescale have both expressed interest in turning AMD around. Analyst Ashok Kumar from CRT Capital Group claims, "[IBM buying AMD is] a pretty low-probability event because IBM is moving away from hardware and manufacturing and moving to software and solutions. I don't think IBM wants the bragging rights to go up against Intel." IBM sold its hard drive making business to Hitachi in 2002 and sold its PC business to Lenovo in 2005. According to Kumar an IBM purchase of AMD would "destroy shareholder value for IBM. http://www.dailytech.com/Report+IBM+...ticle10456.htm |
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IBM Takeover of AMD Speculations Arise
sprite scaler wrote:
IBM Takeover of AMD Speculations Arise Speculations that microchip maker AMD might be bought by IBM surfaced the last couple of days, rising AMD's stock shares by 8% yesterday. Neither parties have commented on the rumour, which however proved to be enough to offer AMD's share a a significant boost. At the same time, IBM's stock was down yesterday by 1.7 percent on the New York Stock Exchange. Some analysts have predicted that with AMD shares being so low, it might be a good time for IBM to acquire them. IBM has had a research and development expense-sharing agreement with AMD. AMD might want to use IBM's East Fishkill, New York, chip-fabrication plant to build microprocessors, in an effort to stengthen its position against rival Intel, who currently has 12 chipmaking plants across the globe, compared to AMD's single chip fabrication plant in Germany. On the other hand, IBM's recent policy to move away from hardware and manufacturing and moving to software and solutions, make the acquisition a low-probability event. IBM sold its computer hard disk business to Hitachi in 2002 and its PC business to China's Lenovo Group in 2005. Last year, IBM sold its printer business to Japan's Ricoh. Earlier Wednesday, IBM said it was buying privately held AptSoft Corp to expand its business event processing software portfolio. Mergermarket.com, a mergers-focused news service, reported on the Financial Times' Web site that IBM and AMD could strengthen their current partnership. "A deal could see IBM's microelectronics division merge with AMD at some point, possibly in the near term," mergermarket.com correspondent David Zielenziger wrote, citing "industry sources." http://www.cdrinfo.com/Sections/News...x?NewsId=22347 By Philipp Gollner and Duncan Martell SAN FRANCISCO (Reuters) - Advanced Micro Devices shares rose as much as 8 percent on Wednesday on speculation that the microchip maker might be bought by IBM, but analysts said the chances of an acquisition were slim. Spokesmen for IBM and AMD, based in Sunnyvale, California, declined to comment on the rumor. Shares of AMD, the second-largest maker of microprocessors after Intel Corp , added as much as 55 cents to $7.39 and were up 23 cents or 3.4 percent at $7.07 in afternoon trading. International Business Machines Corp stock was down $1.73 or 1.7 percent at $99.58 on the New York Stock Exchange. "The takeover of AMD by IBM has been mentioned before and with AMD shares being so low, it might be a good time for IBM to acquire them," said William Lefkowitz, options strategist at brokerage firm vFinance Investments in New York. AMD call options were trading higher than usual because of the rumor, he added. IBM of Armonk, New York, has had a research and development expense- sharing agreement with AMD, and analysts have speculated that AMD might want to use IBM's East Fishkill, New York, chip-fabrication plant to build microprocessors. An acquisition of AMD would be "a pretty low-probability event because IBM is moving away from hardware and manufacturing and moving to software and solutions," said Ashok Kumar, an analyst at CRT Capital Group. "I don't think IBM wants the bragging rights to go up against Intel." "IBM buying AMD is a nonstarter," Kumar said. "There's no rationale for that. Investors would just pound IBM's stock." IBM has been exiting computer hardware businesses to focus on higher- profit software and technology services tailored to clients. Earlier Wednesday, IBM said it was buying privately held AptSoft Corp to expand its business event processing software portfolio. Revenue from IBM's microelectronics business fell 15 percent in the fourth quarter. The unit mainly supplies chips to run IBM's mainframe computers and business server machines. IBM sold its computer disk-drive business to Hitachi Ltd in 2002 and its personal-computer business to China's Lenovo Group Ltd in 2005. Last year, IBM sold its printer business to Japan's Ricoh Co Ltd (7752.T: Quote, Profile, Research). An acquisition of AMD would "destroy shareholder value for IBM," Kumar said. "That argument is a nonstarter." AMD has said it would give details of its "asset-light" manufacturing strategy sometime this year. AMD currently has a chip fabrication plant, or fab, in Germany and has plans to build another one outside Albany, New York. Intel, by comparison, has some 12 chipmaking plants across the globe, and its manufacturing prowess has long been a competitive advantage against smaller rival AMD. Mergermarket.com, a mergers-focused news service, reported on the Financial Times' Web site that IBM and AMD could strengthen their current partnership. "A deal could see IBM's microelectronics division merge with AMD at some point, possibly in the near term," mergermarket.com correspondent David Zielenziger wrote, citing "industry sources." http://www.reuters.com/article/hotSt...41197920080123 Newest Reuters wire claims IBM is considering a purchase of struggling AMD Few will argue that AMD's image and profitability are not what they used to be. AMD was having issues prior to its purchase of graphics maker ATI and things have only worsened since the ATI purchase. DailyTech reported last week that AMD posted a massive loss for Q4 2007 of $1.72 billion while rival Intel posted significant profits across its operations. Between new architectures and aggressive pricing, a shakeup in the microprocessor arena is almost certain for 2008. Reuters now reports IBM is possibly considering a buyout of floundering AMD and some say this would be an ideal time for the buyout with AMD stock prices at a low. IBM and AMD currently have a research and development expense-sharing deal in place. This is not the first time rumors of an IBM buyout of AMD have circulated. Other companies have their eye on AMD as well. Texas Instruments and Freescale have both expressed interest in turning AMD around. Analyst Ashok Kumar from CRT Capital Group claims, "[IBM buying AMD is] a pretty low-probability event because IBM is moving away from hardware and manufacturing and moving to software and solutions. I don't think IBM wants the bragging rights to go up against Intel." IBM sold its hard drive making business to Hitachi in 2002 and sold its PC business to Lenovo in 2005. According to Kumar an IBM purchase of AMD would "destroy shareholder value for IBM. http://www.dailytech.com/Report+IBM+...ticle10456.htm Can't see this happening to be honest. If it however does happen it could lead to interesting times ahead. |
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IBM Takeover of AMD Speculations Arise
Richard P wrote:
news items snipped Can't see this happening to be honest. If it however does happen it could lead to interesting times ahead. Would be nice. If anybody can fix ATI's drivers it's IBM. -- -- --John to email, dial "usenet" and validate (was jclarke at eye bee em dot net) |
#4
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IBM Takeover of AMD Speculations Arise
Can't see this happening to be honest. If it however does happen it could lead to interesting times ahead. Would be nice. If anybody can fix ATI's drivers it's IBM. If anyone can break IBM's list of solid products it's AMD |
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IBM Takeover of AMD Speculations Arise
On Fri, 25 Jan 2008 20:17:18 GMT, "mr deo"
wrote: Can't see this happening to be honest. If it however does happen it could lead to interesting times ahead. Would be nice. If anybody can fix ATI's drivers it's IBM. If anyone can break IBM's list of solid products ... I take it you have never used ClearCase or Tivoli. |
#6
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IBM Takeover of AMD Speculations Arise
On Jan 25, 3:17*pm, "mr deo"
wrote: Can't see this happening to be honest. If it however does happen it could lead to interesting times ahead. Would be nice. *If anybody can fix ATI's drivers it's IBM. If anyone can break IBM's list of solid products it's AMD The only time that i ever bought shares of IBM... April 8th, 1994, i bought shares of IBM at $52.50... sold July 19, 1995 at $107.00, where their earnings were up 2.97 versus 1.14 and sales up 17.531 versus 15.351 billion, yet the price to earnings ratio had declined, thus i figured the market had lost interest. Investor Business Daily had an E number of 79 and a R number of 86. Their earnings report of January 24, 1995 showed an increased price to earnings and their report of April 21, 1995 also showed an increased price to earnings. Thus July's report showing a decrease in price to earnings was a red flag. Looking back at an Investor Business Daily chart within their newspaper, dated June 8, 1994, shows that i had missed a better opportunity to buy, back in Octorber / November of 1993... oh well. Presently, i'd agree with "Mr Deo", that if IBM were to buy AMD, it would be a mistake... for which would be reason to short IBM shares and undoubtedly many people have done sooo already. Given where IBM's thrust has been over the last decade, a merger just wouldn't make a lick of sense. Though one does wonder if AMD is on that same path that National Semiconductor once slid, for which, like National spread rumors, perhaps AMD is doing now... history tends to repeat itself. |
#7
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IBM Takeover of AMD Speculations Arise
IBM sold off their PC division to Lenovo. Why would they want AMD ?
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#8
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IBM Takeover of AMD Speculations Arise
Steven Stone wrote:
IBM sold off their PC division to Lenovo. Why would they want AMD ? To make bucks selling chips to Lenovo? IBM doesn't seem to be in any rush to divest their semiconductor business. -- -- --John to email, dial "usenet" and validate (was jclarke at eye bee em dot net) |
#9
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IBM Takeover of AMD Speculations Arise
mr deo wrote:
Can't see this happening to be honest. If it however does happen it could lead to interesting times ahead. Would be nice. If anybody can fix ATI's drivers it's IBM. If anyone can break IBM's list of solid products it's AMD Probably the other way around. Plus the prices of AMD chips would skyrocket. Bob |
#10
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IBM Takeover of AMD Speculations Arise
Can't see this happening to be honest. If it however does happen it
could lead to interesting times ahead. Would be nice. If anybody can fix ATI's drivers it's IBM. IBM was never famous of graphics stuff ... ??? -- @~@ Might, Courage, Vision, SINCERITY. / v \ Simplicity is Beauty! May the Force and Farce be with you! /( _ )\ (Xubuntu 7.04) Linux 2.6.24 ^ ^ 12:21:01 up 1 day 17:55 0 users load average: 0.00 0.03 0.00 ? ? (CSSA): http://www.swd.gov.hk/tc/index/site_...ub_addressesa/ |
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