Exclusive: AMD hires bank to explore options - sources
By Nadia Damouni and Noel Randewich
NEW YORK/SAN FRANCISCO (Reuters) - Advanced Micro Devices has hired JPMorgan Chase & Co to explore options, which could include a sale, as the chipmaker struggles to find a role in an industry increasingly focused on mobile devices and away from traditional PCs, according to three sources familiar with the situation.
Sources told Reuters on Tuesday that an outright sale of the company is not the main option, and other choices could include a sale of its portfolio of patents.
The company's stock surged 18 percent on the news before ending up 5 percent at $2.09 on the New York Stock Exchange. The shares slipped further to $2.07 in extended trade after AMD said it was "not actively pursuing a sale of the company or significant assets at this time."
"AMD's board and management believe that the strategy the company is currently pursuing to drive long-term growth by leveraging AMD's highly-differentiated technology assets is the right approach to enhance shareholder value," spokesman Drew Prairie said in an email to Reuters.
When asked why AMD had hired JPMorgan, Prairie declined to confirm the engagement, saying the company does not comment on its relationship with investment banks.
A JPMorgan spokeswoman declined to comment.
One of Silicon Valley's oldest chipmakers, AMD is laying off engineers and some analysts are concerned it may not find new markets for its chips in time to reverse a declining cash reserve.
AMD's shares have fallen more than 60 percent this year, giving it a market value of about $1.4 billion. It also has long-term debt and capital lease obligations of about $2 billion. Continued...