Advanced Micro Devices, Inc’s (AMD) deal to acquire California-based programmable device designer Xilinx Corporation will be entering its second phase of regulatory review in China. The European Commission and the United Kingdom’s Competiton and Markets Authority (CMA) have already cleared the deal. The deal’s waiting period for the United States Federal Trade Commission (FTC) investigation has also expired.
Since the company has already received clearance from three major global regulatory bodies, the Chinese approval, which is in its final stage for the affair, is set to cost the company $35 billion. However, this clearance will also diversify the company’s product portfolio to target emerging computing markets such as artificial intelligence, machine learning, and fifth-generation (5G) cellular networks.
The latest details emerging regarding the deal suggest that China’s State Administration for Market Regulation (SAMR) has contacted industry participants to gauge the impact of the deal. It wants to thoroughly find how it will affect the market share for computing products.
China’s State Administration for Market Regulation or SAMR is believed to have reached out to industry participants a few months ago to find out their views on market definitions and market shares, according to an MLex report. Some consider this deal similar to Intel’s purchase of Altera in late 2015, which was cleared by China.
AMD is quite optimistic about the deal, and the company believes that it expects that the deal will close by the end of this year. AMD’s confidence comes after receiving the clearance report from the officials in the European Union’s European Commission at the close of June.
The transaction was examined under the normal merger review procedure. The Commission concluded that the proposed transaction would raise no competition concerns in the European Economic Area given the absence of horizontal overlaps and vertical relationships between the activities of the companies. The Commission assessed possible conglomerate effects and concluded that the transaction does not raise competition concerns in that regard, given the lack of ability and incentive to foreclose rival providers of CPUs and GPUs and the presence of alternative suppliers.
