AMD: No Private Equity Bailout for AMD
Last week the market got its hopes up that Advanced Micro Devices (AMD - Annual Report) might sell out to private equity. Instead, it will borrow more money from private investors.
Advanced Micro to sell $1.8 bln debt after S&P cut | Reuters.com
Advanced Micro Devices Inc., the No. 2 maker of chips used in personal computers, said on Monday it will privately sell $1.8 billion in convertible senior debt.The Sunnyvale, California-based company will use net proceeds to pay off debt, to enter into transactions to reduce potential dilution to shareholders, and for general corporate purposes. It may sell an additional $400 million in the debt to meet demand.
We’ve disparaged these deals, which we consider to be nothing more than sleight-of-hand, before. There is no need to do so again here. As to the potential for a private equity deal:
Credit rating agency Standard & Poor’s downgraded the company on Monday to “B,” its fifth-highest “junk” grade, from “B-plus,” with a negative outlook. S&P said the downgrade reflected “recent subpar execution of (AMD’s) business plans” and a more difficult market environment.
The company is already too leveraged. It is unfeasible to take on additional debt in order to remove equity. It just ain’t gonna happen.
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AMD private equity buyout rumors gain momentum
by Cyril Kowaliski - 11:26 am, May 4, 2007
AMD is the subject of buyout interest from private equity firms are gaining credibility, according to a report by ExtremeTech. The rumors are as of yet unconfirmed by either AMD or the unnamed private equity firms. Nevertheless, shareholders are taking the buyout talk seriously enough, and the site says AMD’s stock price climbed more than 5% “There are private equity buyout $28.00 AMD offer. At least in the near term, the options market is giving some credence to these rumors,” an Interactive Brokers Group equity risk manager told ExtremeTech.
IBM in talks to offer $28.00 for AMD BUYOUT
AMD private equity buyout rumors gain momentum
by Cyril Kowaliski - 11:26 am, May 4, 2007
AMD is the subject of buyout interest from private equity firms are gaining credibility, according to a report by ExtremeTech. The rumors are as of yet unconfirmed by either AMD or the unnamed private equity firms. Nevertheless, shareholders are taking the buyout talk seriously enough, and the site says AMD’s stock price climbed more than 5% “There are private equity buyout $28.00 AMD offer. At least in the near term, the options market is giving some credence to these rumors,” an Interactive Brokers Group equity risk manager told ExtremeTech.