One semiconductor giant that’s trying to acquire another in multi-billion-dollar deal just got some really good long-awaited news out of China. That there are two possible deals that fit that description says a lot of the current state of the global semiconductor market.
In this case, it’s AMD’s $35 billion deal to buy Xilinx that is getting the conditional nod from China's State Administration for Market Regulation, according to Reuters and other media reports. Alas, the other multi-billion-dollar semiconductor acquisition we’ve all been following–Nvidia’s $40 billion bid to buy Arm–might be heading toward dissolution, according to published reports.
The news comes after AMD at the end of December issued a statement saying that the deal was on track to close in the first quarter of 2022, updating a previous timeline under which the companies hoped to have it wrapped up by the end of 2021. The acquisition was announced in October 2020.
The conditions from Chinese regulators include the requirement that AMD continue selling its products without discrimination to Chinese companies, and not force tie-in sales involving multiple product sets. AMD also must continue to ensure the programmability and flexibility of Xilinx FPGAs
Xilinx on Wednesday reported its fiscal third quarter earnings, which included a 26% year-over-year revenue jump to $1.01 billion. The company did not hold a formal earnings call to discuss the results, but in its earnings statement said that, as allowed under the terms of its agreement with AMD, its board of directors “voted unanimously to declare a cash dividend of $0.37 per outstanding share of common stock payable on February 14, 2022 to all stockholders of record at the close of business on February 7, 2022. The dividend is conditioned upon and will only be payable if the merger has not closed on or before the record date for such dividend.”
Meanwhile, AMD is set to report its latest quarterly financial results on Feb. 1, at which time it’s a good bet that AMD officials will provide an update–or at least prompted to do so by analysts on its earnings call–about the pending deal, which has now cleared all major international regulatory hurdles.
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