Chipmaker AMD said to be in talks to buy rival Xilinx in US$30 billion deal

AMD is in advanced talks to buy rival chip maker Xilinx in a deal valued at potentially more than US$30 billion.
AMD is in advanced talks to buy rival chip maker Xilinx in a deal valued at potentially more than US$30 billion.PHOTO: ADVANCED MICRO DEVICES

NEW YORK (BLOOMBERG) - Advanced Micro Devices is in advanced discussions to buy Xilinx in a takeover that could be valued at US$30 billion (S$40.7 billion), according to people familiar with the matter.

The deal could come together as early as next week though things remain in flux, the people said, asking not to be identified discussing a private deal. The Wall Street Journal first reported on the negotiations.

A combination with Xilinx would give AMD chief executive officer Lisa Su more of the pieces needed to break Intel Corp's stranglehold on the lucrative market for data centre computer components. It would follow moves by rival Nvidia Corp, which bought Mellanox Technologies and aims to use its pending acquisition of Arm Ltd to grab more of that business for itself.

AMD's stock has almost doubled this year as it gains a larger share of the lucrative market for server chips from Intel, after decades of lagging behind its larger rival. Xilinx is valued at US$26 billion but AMD is expected to pay a premium in any buyout.

Acquiring Xilinx, which makes programmable chips for wireless networks, would help it expand into a new market just as carriers spend billions to build fifth-generation or 5G.

Xilinx makes field programmable gate arrays, or FPGAs. That kind of chip is unique in being able to have its function altered by software, even after it's been installed in a piece of machinery. Xilinx's chips have historically been used in telecommunications equipment but under CEO Victor Peng, the company is expanding into products targeted at data centers where FPGAs can be used to accelerate workloads such as artificial intelligence.

Representatives for AMD and Xilinx declined to comment.