AMD acquires Xilinx for $35 billion in an all stock deal
AMD shareholders will own 74% of the combined company, while Xilinx shareholders will receive the remaining 26%.
Legendary stock market analyst Jim Cramer believes AMD stock is “a bargain
The shares of Advanced Micro Devices (NASDAQ: AMD) are trading lower this week after the chip manufacturer paid $35 billion in an all stock deal to acquire Xilinx (NASDAQ: XLNX).
Fundamental Analysis: Significant Investment
In another deal in the semiconductor industry, investors will receive 1.7234 shares of AMD for each Xilinx share. Once the transaction is approved, AMD shareholders will own 74% of the combined company, while Xilinx shareholders will receive the remaining 26%.
“The merger with AMD will help accelerate growth in our data center business and enable us to reach a broader customer base in more markets,” said Victor Peng, Chief Executive of Xilinx.
Dr. Lisa Su, CEO of AMD, will lead the new company as Peng becomes president responsible for Xilinx.
A few days ago, Xilinx announced a groundbreaking product that will have a major impact on the adoption of 5G infrastructure.
“For the first time, Xilinx is providing a wireless radio platform with more hardened application-specific IP than adaptive logic to meet the requirements of a 5G infrastructure with low power consumption and low cost,” said Liam Madden, head of the Wired and Wireless Group (WWG) at Xilinx.
Two weeks ago, Invezz reported that AMD and Xilinx were in discussions about a merger.
Technical analysis: Stocks threaten to close lower
Jim Cramer, the legendary presenter of CNBC’s “Mad Money”, commented that AMD shares look like “a bargain”.
AMD Stock Chart (Trading View)
“I think AMD still has a lot of advantages. You get today’s incredible, great quarter practically for free. At these levels I think the stock is a bargain,” he said.
AMD’s share price is trading 4.8% lower this week after falling over 3% in Xilinx news. The stock is now approaching an important buy zone near $73.00, where both the 200 DMA and multi-month horizontal support is taking place.
Summary
AMD stocks are trading lower this week as the price action approaches an intra-monthly support line near the $73 mark, providing a solid opportunity to invest in AMD stock.
