China to conditionally approve AMD $35 billion acquisition of Xilinx

Published: 27th Jan 2022, 10:36 GMT   Comments

AMD’s acquisition of Xilinx has a green light from the Chinese State Administration for Market Regulation

Chinese market regulator conditionally approves Xilinx’s acquisition by AMD.

AMD’s stock price has declined nearly 20% since this year has started. As investors take cash their money away from emerging semiconductor companies AMD is awaiting approval for its 2020 bid to purchase Xilinx, a company specializing in programmable logic devices.

Nasdaq reports that the deal has been approved in every market except for China. This acquisition would make AMD more competitive against Intel who purchased a competing FPGA maker Altera back in 2015, the website notes.

Today Reuters confirms that the acquisition has been approved by the Chinese regulator, who published a full statement here. The regulator will approve the transaction if both parties agree to 6-year conditions.

SHANGHAI, Jan 27 (Reuters) – China’s market regulator said on Thursday it had conditionally approved Advanced Micro Devices Inc’s (AMD.O) $35 billion all-stock deal for peer Xilinx (XLNX.O).

— Reuters

Just yesterday the news broke that NVIDIA is to abandon $40 billion acquisition plans of ARM Holidings after encountering strong opposition from the market regulators.

Announcement of the State Administration for Market Regulation

[…] Review decision

In view of the fact that this concentration of operators in the CPU , GPU accelerator and FPGA markets has or may have the effect of eliminating or restricting competition, the State Administration for Market Regulation has decided to approve this concentration with additional restrictive conditions based on the commitment plan submitted by the declarer. Both parties to the transaction and the entity after concentration perform the following obligations:

  1.  When selling Chaowei CPU , Chaowei GPU and Xilinx FPGA to the Chinese domestic market , tie-in sales shall not be forced in any way, or any other unreasonable transaction conditions shall be attached; customers shall not be hindered or restricted from purchasing or using alone The above- mentioned products; customers who purchase the above-mentioned products alone shall not be discriminated against in terms of service level, price, software function, etc.
  2. On the basis of existing cooperation with Chinese domestic enterprises, further promote relevant cooperation, and continue to supply Chaowei CPU , Chaowei GPU , Xilinx FPGA and related software to the Chinese domestic market in accordance with the principles of fairness, reasonableness and non-discrimination ,Accessories.
  3. Ensure the flexibility and programmability of Xilinx FPGAs , continue to develop and ensure the availability of Xilinx FPGA product families, and ensure that their development methods are compatible with ARM -based processors and in line with Xilinx’s trading previous plan.
  4. Continue to ensure the interoperability of Chaowei CPU , Chaowei GPU , Xilinx FPGA and third-party CPU , GPU and FPGA sold to the domestic market of China ; the above- mentioned interoperability level is not lower than that of Chaowei CPU , Chaowei Level of interoperability between GPUs and Xilinx FPGAs ; information, features, and samples on interoperability upgrades should be made available to third-party CPU , GPU , FPGA manufacturers within 90 days of upgrade.
  5. Take protective measures for the information of third-party CPU , GPU and FPGA manufacturers , sign confidentiality agreements with third-party CPU, GPU and FPGA manufacturers; store the confidential information of third-party CPU , GPU and FPGA manufacturers in independent and in hardware systems that do not communicate with each other.

In addition to the supervision and implementation of restrictive conditions in accordance with this announcement, the commitment plan for additional restrictive conditions submitted by Chaowei to the State Administration for Market Regulation on January 13, 2022 is legally binding on both parties to the transaction and the entity after the concentration. From the effective date, both parties to the transaction and the entity after the concentration shall report the implementation of this commitment plan to the SAMR semi-annually.

After 6 years from the effective date , the post-concentration entity may apply to the State Administration for Market Regulation to lift the conduct conditions. The State Administration for Market Regulation will make a decision on whether to cancel the application based on the application and market competition. Without the approval of the State Administration for Market Regulation , the entity should continue to fulfill the restrictive conditions after the concentration.

The State Administration for Market Regulation has the right to supervise and inspect the performance of the above obligations by the two parties to the transaction and the entity after the concentration by supervising the trustee or by itself . If both parties to the transaction and the entity after the concentration fail to perform or violate the above obligations, the State Administration for Market Regulation will deal with it in accordance with the relevant provisions of the Anti-Monopoly Law.

This decision will take effect from the date of the announcement.

State Administration for Market Regulation

End of the Announcement

Source: Nasdaq, Reuters, SAMR




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