AMD’s (NASDAQ:AMD) Chances Of Capital Injection Diminish – Negotiations With Silver Lake Stalled

LoadsaMoney · 29 Sep 2015 at 13:52

AMD’s talks with private equity firm Silver Lake to sell a 25% stake reportedly stalled after the two couldn’t agree on a price and strategy. The Sunny Vale California based chipmaker Advanced Micro Devices (NASDAQ:AMD) was reportedly negotiating an equity deal with Silver Lake Management over the summer. However the negotiations were put on hold after both companies failed to reach on agreement Bloomberg reports....

Chutney :- http://wccftech.com/amd-nasdaqamd-equity-deal-silver-lake-put-hold-negotiations-stalled/

Gregster · 29 Sep 2015 at 14:11

Uh oh, more doom and gloom

LambChop · 29 Sep 2015 at 14:12

That's the problem most investors will have. Anyone from the outside can see they are failing, yet they cant agree on strategy input from the outside. Imo, a stubborn mule of a company that is reaping exactly what they deserve.

Geeman1979 · 29 Sep 2015 at 14:13

The obligatory.

Doooooooooomed!

Jim99 · 29 Sep 2015 at 15:10

I think this would be a great time to relate it in some vague and nebulous way to the release of the Nano.

Stanners · 29 Sep 2015 at 15:55

It is not good news, What is the issue with someone just saying more doom and gloom. If the article is correct there is obviously an issue somewhere with the deal, Maybe more interested parties putting AMD in a stronger position.....

Who knows, but from the article it is not good news with regards to the cash injection we were expecting for AMD. Another thought is the whole thing could be rubbish anyway

Insanties_birth · 29 Sep 2015 at 17:11

Gregster said:
Uh oh, more doom and gloom

To be fair it only states the talks were stalled not cancelled, could still get it done by the end but we'll just have to wait for more news.

pgi947 · 29 Sep 2015 at 17:18

Insanties_birth said:
To be fair it only states the talks were stalled not cancelled, could still get it done by the end but we'll just have to wait for more news.

Yep, one doesn't quite agree to the others terms, it'll most likely get thrashed out in the boardroom. Besides, their share price has barely budged since this news was broken, if the deal was dead in the water it would likely have seen a significant drop

humbug · 29 Sep 2015 at 17:19

Tough call, AMD need a lot of cash to get back on the map and Silver Lake may not be willing to put the money up because they quiet rightfully don't think its worth it.

AMD may hold out until late 2016 when they have new GPU's, APU's and CPU's, they think they may have a stronger hand with those products on the market.

Insanties_birth · 29 Sep 2015 at 17:36

humbug said:
Tough call, AMD need a lot of cash to get back on the map and Silver Lake may not be willing to put the money up because they quiet rightfully don't think its worth it.

AMD may hold out until late 2016 when they have new GPU's, APU's and CPU's, they think they may have a stronger hand with those products on the market.

Then why would they be there in the first place :confused:

More than likely they are just expecting (as stated in the article) to have a different vision of what needs to be done to change the fortunes of AMD. Concentrate more on VR / Mobile chips / rebranding / low range focus etc. Hard to say without being there but I think the idea they don't find AMD to be worth the price would be contrary to them going into negotiations to buy AMD. These sort of deals no doubt have some price discussions but I doubt they went in expecting to haggle the socks off AMD and with the mindset that there's no deal to be had unless they can savagely knock them down in price.

It's more about recouping the cost and that means getting AMD back in fighting shape and on the right path with the right tools, sounds like they didn't agree on the path.

humbug · 29 Sep 2015 at 17:39

Insanties_birth said:
Then why would they be there in the first place More than likely they are just expecting (as stated in the article) to have a different vision of what needs to be done to change the fortunes of AMD. Concentrate more on VR / Mobile chips / rebranding / low range focus etc. Hard to say without being there but I think the idea they don't find AMD to be worth the price would be contrary to them going into negotiations to buy AMD. These sort of deals no doubt have some price discussions but I doubt they went in expecting to haggle the socks off AMD and with the mindset that there's no deal to be had unless they can savagely knock them down in price.

It's more about recouping the cost and that means getting AMD back in fighting shape and on the right path with the right tools, sounds like they didn't agree on the path.

I'm just guessing

D.P. · 29 Sep 2015 at 17:42

It is hard to reach too much in to this.

Silver Lake were undoubtedly trying to get a bargain and throw AMD a lifeline with very unattractive valuation. AMD will have believed the company is worth more and at this time don't think they are in such dire stats that they need the cash injection. In this light it might be positive news for AMD. However, it is a pretty big gamble because the more more money AMD loose and the more they cut back the deeper the hole they dig for themselves and the harder it will be to climb out.

AMD shares are close to an all time low, so it doesn't look like the markets took AMD"s decision positively but there is also no signs of a large dip (which is hard when you are at close to rock bottom.

Insanties_birth · 29 Sep 2015 at 17:57

humbug said:
I'm just guessing

fair enough, they might have hoped for a quick haggle.

Seanspeed · 29 Sep 2015 at 18:31

Does AMD have actual debt or is the concern merely that they're falling too far behind Nvidia and Intel with market share?

FoxEye · 29 Sep 2015 at 18:36

Seanspeed said:
Does AMD have actual debt or is the concern merely that they're falling too far behind Nvidia and Intel with market share?

Apparently they have over $2 billion of debt, but supposedly it's debt they can ignore for a few years. Seems a lot but I'm not an expert in the affairs of big businesses

Seanspeed · 29 Sep 2015 at 18:43

FoxEye said:
Apparently they have over $2 billion of debt, but supposedly it's debt they can ignore for a few years. Seems a lot but I'm not an expert in the affairs of big businesses

If that's true, that would definitely make it more of a desperate situation for them. Was just curious, since I haven't been following this closely at all.

Wish them luck, for their sake and ours. I'm not an Nvidia hater at all, but I quite appreciate the kind of forward thinking that goes on at AMD.

D.P. · 29 Sep 2015 at 18:45

Seanspeed said:
Does AMD have actual debt or is the concern merely that they're falling too far behind Nvidia and Intel with market share?

AMD have $2 billion debt and last year made a loss of $400 million, ergo, if something doesn't drastically change soon it wont be good news.

FoxEye · 29 Sep 2015 at 18:47

D.P. said:
AMD have $2 billion debt and last year made a loss of $400 million, ergo, if something doesn't drastically change soon it wont be good news.

I thought they'd returned to profitability, or at least broken even? I guess not :eek:

Gregster · 29 Sep 2015 at 18:56

Insanties_birth said:
To be fair it only states the talks were stalled not cancelled, could still get it done by the end but we'll just have to wait for more news.

Quite true and I really do hope that some investor/s will plough some serious cash into AMD and bring them back to the forefront. We all need the competition and this is what drives tech forward and makes prices competitive.

thebennyboy · 29 Sep 2015 at 20:19

Gregster said:
We all need the competition and this is what drives tech forward and makes prices competitive.

Couldn't agree more!

Competitor rules

AMD’s (NASDAQ:AMD) Chances Of Capital Injection Diminish – Negotiations With Silver Lake Stalled

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