Friday, August 1, 2008

AMD to Sell Consumer Electronics DTV Business Unit to Broadcom – Analyst

Advanced Micro Devices plans to sell its consumer electronics TV business unit it got with the acquisition of ATI Technologies back in 2006 to Broadcom, an analyst said. Earlier this year AMD wrote down $880 million from its goodwill and intangible assets due to lowering revenues of its “non-core” businesses.

“Broadcom is a likely buyer for some of ATI's products. We believe that Broadcom is a likely candidate to acquire AMD’s consumer TV business for about $250-$375 million as it has a comfort level and history with integrating former ATI products and management,” said analyst Doug Freedman of American Technology Research in a note to customers, reports EETimes web-site.

After the management of AMD took over ATI Technologies’ businesses, revenues of the consumer electronics units, which includes chips used inside digital TV-sets as well as chips for mobile phones, dropped nearly 40% year-over-year. Recently AMD implied that it may sell off its “non-core” businesses.

“The business includes DTV chips that are sold into major name brand digital TVs. We believe Sony and Samsung as well has HiSense (China) are all ATI customers. We also view the handset-based product line as available for sale, however, we are unable to identify a potential buyer given the limited customer base,” said Mr. Friedman.

AMD did not comment on the news-story.

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