Advanced Micro Devices (AMD) plans to buy graphics chip vendor, ATI Technologies, for $US5.4 billion, according to The Wall Street Journal. It expected an announcement regrading the deal to be made shortly.
ATI and AMD executives in the US could not immediately be reached for comment.
Rumours that AMD would buy ATI have been circulating for a couple months. The deal would add significantly to AMD's product line, bringing in a lineup of cutting-edge graphics chips and chip sets that include integrated graphics capabilities. Chip sets are the component on a PC motherboard that link a processor with main memory and other components, such as a hard disk.
These additions to AMD's product line will help the company better match rival, Intel, which offers its own line of chip sets with graphics capabilities. But the deal will likely threaten AMD's relationship with Nvidia, ATI's main rival in the graphics space and an important AMD partner.