Declaration of a new company “determined to drive growth, innovation and choice for its customers, particularly in the commercial and mobile computing segments and in the rapidly-growing consumer electronics market.”
Hector Ruiz, Chairman and CEO of AMD said, “We believe AMD and ATI will drive growth and innovation for the entire industry, enabling our partners to create differentiated solutions and empowering our customers to choose what is best for them.”
Current President and CEO of ATI, Dave Orton said “All of our product lines will benefit.”
Microsoft’s Jim Allchin, of the Platforms and Services division, stated that “We’re excited by the potential of what AMD and ATI can deliver together to enhance the Windows Vista experience for our customers even further.”
AMD is making the purchase with $4.2 billion in cash, and 57 million shares of AMD common stock. AMD has obtained a $2.5 billion loan commitment from Morgan Stanley, and will make the full price with a combination of cash, cash equivalents, and short term investments.
The purchase is awaiting ATI shareholder approval, and approval from Canadian and American regulatory agencies. In the event that the transaction is not completed, ATI has agreed to pay AMD a termination fee of $162 million.
The deal is expected to be completed in the fourth quarter of 2006.