Bookmark and Share


The world’s second largest supplier of x86 microprocessors, Advanced Micro Devices, has announced that it had succeeded in closing $2.2 billion offering of convertible senior notes and is now capable to pay its debts and operation costs for several quarters. The announcement may also mean that the recent rumours about takeover of AMD will remain rumours and the company will stay independent for at least several quarters.

AMD estimates that the net proceeds from the offering, will be approximately $2169 million, after deducting discounts, commissions and estimated offering expenses. AMD used approximately $182 million of the net proceeds of the offering to fund the cost of the capped call transactions. AMD used $500 million of the remaining net proceeds to repay a portion of the term loan AMD entered into with Morgan Stanley Senior Funding, to finance a portion of the purchase price of, and expenses related to, the acquisition of ATI Technologies. AMD will use the remaining amount for general corporate purposes, including working capital and capital expenditures.

The company has raised nearly $2.2 billion for 6% convertible senior notes due 2015 and set the so-called cap price of $42.12 per share, which means that the firm will only have to transfer its shares worth $2.2 billion to its investors only after they hit $42.12 price-point. Currently AMD’s stock is valued at $13.82.

It is interesting to note that AMD did not use similar instruments to fund its existence back in late-2002 – early-2003 period when it also faced fierce war from Intel with product portfolio that was not as good as its larger rival’s. AMD’s highest price of stock in the last five years was above $40 in the first quarter of 2006, while the lowest was below $13 this March. The company’s stock cost about $4 in October, 2002, but started to quickly grow in mid-2003 once the company launched its AMD Opteron processor.

AMD hopes that its next-generation chip code-named Barcelona with improved micro-architecture will help its sales later this year.


Comments currently: 0

Add your Comment

Related news

Latest News

Monday, July 21, 2014

12:56 pm | Microsoft to Fire 18,000 Employees to Boost Efficiency. Microsoft to Perform Massive Job Cut Ever Following Acquisition of Nokia

Tuesday, July 15, 2014

6:11 am | Apple Teams Up with IBM to Make iPhone and iPad Ultimate Tools for Businesses and Enterprises. IBM to Sell Business-Optimized iPhone and iPad Devices

Monday, July 14, 2014

6:01 am | IBM to Invest $3 Billion In Research of Next-Gen Chips, Process Technologies. IBM to Fund Development of 7nm and Below Process Technologies, Help to Create Post-Silicon Future

5:58 am | Intel Postpones Launch of High-End “Broadwell-K” Processors to July – September, 2015. High-End Core i “Broadwell” Processors Scheduled to Arrive in Q3 2015

5:50 am | Intel Delays Introduction of Core M “Broadwell” Processors Further. Low-Power Broadwell Chips Due in Late 2014