“On Monday, AMD agreed to acquire graphics powerhouse ATI Technologies in a surprise $5.4 billion deal that will radically alter the landscape of the PC component industry.
ATI will become ‘the ATI business division,’ within AMD, and its chief executive and president, Dave Orton, will become an executive vice president reporting to both AMD president and chief operating officer Dirk Meyer and AMD’s chief executive, Hector Ruiz. The deal, if agreed to by shareholders, will total $4.2 billion in cash and 57 million shares of AMD common stock, which the company is valuing at $18.26 per share,” Mark Hachman reports for PC Magazine.

“The deal was not expected, primarily because AMD had always positioned itself as a vendor that allowed its customers a choice of components. Intel’s Centrino platform combines a processor, chipset, and communications chip,” Hachman reports. “That would seem to indicate that either ATI or AMD will see to develop communications processors, or else put a number of communications chip companies in play. AMD has traditionally encouraged its OEM vendors to buy components from both Atheros and Broadcom.”

Full article here.

AMD’s press release here.