AMD gains antitrust approval to buy ATI

AMD has gained approval from key U.S., Canadian and German anti-trust regulators for its $5.4 billion plan to buy ATI Technologies.

Advanced Micro Devices (AMD) said Wednesday it has gained approval from key U.S., Canadian and German antitrust regulators for its US$5.4 billion plan to buy Canadian chipset developer ATI Technologies.

Ant-trust approval for the deal, which has been billed as a major step forward for AMD in its battle against rival Intel, pushes the acquisition far closer to completion. But it still faces several smaller hurdles, including a vote of approval by ATI shareholders on Oct. 13, and further scrutiny by regulators in Canada and Taiwan.

The companies expect the acquisition to close by Nov. 30 of this year. ATI has to pay AMD a termination fee of $162 million if it backs out of the arrangement.

AMD said a required waiting period related to the Hart-Scott-Rodino Antitrust Improvements Act of 1976 has expired, opening the door for its purchase of ATI as far as U.S. antitrust authorities are concerned. Canada's Commissioner of Competition has also given the deal a green light, as has the German Federal Cartel Office.

The world's second largest microprocessor maker hopes the ATI purchase will beef up its graphics and chipset prowess, and give it a new weapon in its fight for market share against Intel. Until now, AMD has relied on third-party chipset makers such as ATI, Nvidia of the U.S., as well as two Taiwanese chipset vendors, Via Technologies and Silicon Integrated Systems, for the majority of its chipsets.

Chipsets are a vital pair of chips inside a PC that regulate the flow of data between the microprocessor and other system chips, such as memory and graphics. Many chipsets integrate graphics, allowing PC makers to forego adding graphics cards to systems. Some analysts believe that in the future, chipsets will take on far more work than just graphics, one day including even the microprocessor.

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Dan Nystedt

IDG News Service
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