🔥 AMD Eyes $4.9 Billion Acquisition of ZT Systems
posted 19 Aug 2024
Chipmaker AMD plans to acquire ZT Systems, a provider of advanced computing systems, for $4.9 billion to bolster its position in the AI chip market. The primary goal is to challenge the industry leader, Nvidia.
AI systems are our number one strategic prioritystated AMD CEO Lisa Su.
The company intends to finance the acquisition with 75% cash and the remaining amount through its own stock. As of Q2 2024, AMD held approximately $5.34 billion in cash and short-term investments, which are expected to yield returns soon.
If all goes as planned, AMD expects to accelerate the testing of new AI graphics processors and enhance delivery speeds for customers like Microsoft and OpenAI. However, the workforce at ZT Systems is expected to be cut more than half, from 2,500 to 1,000 employees.
The deal is expected to close in the first half of 2025, but selling off unnecessary production facilities could take additional time. U.S. and other regulators may review the deal for antitrust compliance, potentially delaying its completion.
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