On October 27, 2020, AMD (NASDAQ:AMD) and Xilinx (NASDAQ:XLNX) have entered into a definitive agreement for AMD to acquire Xilinkx in an all-stock transaction for US$35 billion. Under the agreement, AMD will pay $1.7234 per Xilinx (NASDAQ:XLNX) share. The two companies are heavily integrated into the semiconductor industry’s biggest growth segments: gaming PCs, data centers, automotive, communications, industrial, aerospace, and defense. It makes sense for the two firms to come together. AMD (NASDAQ:AMD) wants to get into the server business. This particular field is dominated by bluechip juggernaut Intel (NASDAQ:INTC) which is AMD’s (NASDAQ:AMD) main target for competition.
In a statement, both companies said that the deal “[merges] central processing units, graphic processing units, adaptive chip systems, and deep software expertise to enable leadership in computing platforms for cloud, edge and end devices.”
Both companies have overlapping competencies in many areas, and AMD (NASDAQ:AMD) might set its revenue soaring if the merger is approved worldwide. The reason?
The significance of this news for the summer comes from the recent push to put the deal through UK and EU regulators. Some are saying that UK/EU approval of the AMD (NASDAQ:AMD) / Xilinx (NASDAQ:XLNX) might make AMD’s stock go up to $100. The bottom line is to wait and see, and most agree that the big merger won’t see final approval until the end of Q4, 2021.
It’s not the first time recently that lawmakers have eyed semiconductors. Recent massive supply shortages due to CV19 and Bitcoin mining demand has caused a shortage in semiconductors in the US, and President Joe Biden’s administration are trying to solve this.
Everyone Wants Semiconductors
Other recent news sees AMD (NASDAQ:AMD) go up 4% after a deal with Google (NASDAQ:GOOG) to put EPYC chips into TAU Vms for servers. From all of these developments, it’s pretty obvious that AMD (NASDAQ:AMD) will be a solid pick for the future. While competitor Nvidia (NASDAQ:NVDA) deals with crypto mining demand for their GPUs, AMD (NASDAQ:AMD) is the next alternative.
Comparing AMD to Nvidia is like Amazon Prime Video to Netflix (NASDAQ:NFLX).
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