SAMR said that the transaction will be approved if the semiconductor companies do not force tie-in sales of products or discriminate against customers who purchase one set of products but not another
AMD has secured Chinese approval for Xilinx acquisition. (Credit: Coolcaesar/Wikipedia.org)
Advanced Micro Devices (AMD) has secured conditional approval from China’s State Administration for Market Regulation (SAMR) for its previously announced $35bn acquisition of rival US-based semiconductor firm Xilinx.
The decision from the Chinese market regulator is said to be the last major regulatory hurdle to clear for AMD.
SAMR, in a public notice, said that the deal will be approved if AMD and Xilinx do not force tie-in sales of products or discriminate against customers who purchase one set of products but not another.
Furthermore, the Chinese regulator stated that the combined entity, post-merger, should also ensure both flexibility and programmability of Xilinx’ field programmable gate arrays (FPGAs) and that their development methods have compatibility with ARM-based processors.
Besides, the regulator laid the condition that the enlarged firm should make sure that its graphics processing units (GPUs) and FPGA products sold to China are interoperable with products in the Chinese market.
The all-stock deal between AMD and Xilinx was signed in October 2020. Through the deal, AMD aims to establish one of the top high performance computing companies with an enterprise value of nearly $135bn.
As per the terms of the transaction, Xilinx’s shareholders will be given 1.7234 shares of AMD for each share of Xilinx common stock. In the combined firm, the current shareholders of AMD will hold a stake of around 74%, while Xilinx’s stockholders will own the remaining 26% stake.
The deal was approved by shareholders of both firms in April 2021.
It was approved by the UK Competition and Markets Authority (CMA) in June 2021 and the following month by the European Commission.
Xilinx is primarily active in supplying FPGAs, while AMD is engaged in supplying central processing units (CPUs) based on the x86 instruction set, GPUs, and semi-custom processors for the gaming market.
In December 2021, AMD issued a statement that the transaction is expected to close in Q1 2022. The closing will be subject to the expiration of the waiting period under the Hart-Scott-Rodino (HSR) Act in the US and the meeting of the conditions set forth in the merger agreement.