© Paul Sakuma / AMD Business | October 27, 2020
AMD to acquire Xilinx in a $35 billion deal
AMD and Xilinx have entered into a definitive agreement for AMD to acquire Xilinx in an all-stock transaction valued at USD 35 billion.
The acquisition brings together two major industry players with complementary product portfolios and customers. Together, the combined company will capitalise on opportunities spanning some of the industry’s most important growth segments from the data center to gaming, PCs, communications, automotive, industrial, aerospace and defense. “Our acquisition of Xilinx marks the next leg in our journey to establish AMD as the industry’s high performance computing leader and partner of choice for the largest and most important technology companies in the world,” says AMD President and CEO Dr. Lisa Su in a press release. “This is truly a compelling combination that will create significant value for all stakeholders, including AMD and Xilinx shareholders who will benefit from the future growth and upside potential of the combined company. The Xilinx team is one of the strongest in the industry and we are thrilled to welcome them to the AMD family.” “We are excited to join the AMD family. Our shared cultures of innovation, excellence and collaboration make this an ideal combination. Together, we will lead the new era of high performance and adaptive computing,” adds Victor Peng, Xilinx president and CEO. “Our leading FPGAs, Adaptive SoCs, accelerator and SmartNIC solutions enable innovation from the cloud, to the edge and end devices. We empower our customers to deploy differentiated platforms to market faster, and with optimal efficiency and performance. Joining together with AMD will help accelerate growth in our data center business and enable us to pursue a broader customer base across more markets.” With a combined team of 13'000 engineers and over USD 2.7 billion of annual R&D investment, AMD will have additional talent and scale to deliver a stronger set of products and domain-specific solutions. The transaction is expected to be immediately accretive to AMD margins, EPS and free cash flow generation and deliver industry-leading growth. Under the terms of the agreement, Xilinx stockholders will receive a fixed exchange ratio of 1.7234 shares of AMD common stock for each share of Xilinx common stock they hold at the closing of the transaction. Based on the exchange ratio, this represents approximately USD 143 per share of Xilinx common stock. Post-closing, current AMD stockholders will own approximately 74% of the combined company on a fully diluted basis, while Xilinx stockholders will own approximately 26%. AMD expects to achieve operational efficiencies of approximately USD 300 million within 18 months of closing the transaction, primarily based on synergies in costs of goods sold, shared infrastructure and through streamlining common areas. Dr. Lisa Su will lead the combined company as CEO. Xilinx President and CEO, Victor Peng, will join AMD as president responsible for the Xilinx business and strategic growth initiatives, effective upon closing of the transaction. The transaction is currently expected to close by the end of calendar year 2021. Until close, the parties remain separate, independent companies.
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