Monolithic Memories Inc, which leaped into gate arrays earlier this year and thought better of it almost immediately (CI No 657) has agreed in principle to be acquired by Advanced Micro Devices Inc in a share exchange deal valuing Monolithic at about $440m. The agreement calls for AMD to pay 0.875 new shares for each of Monolithic’s 21.8m outstanding.The transaction is subject to definitive agreement, approval of shareholders of each company and regulatory approvals. The plan is to operate Monolithic as a wholly-owned subsidiary of Advanced Micro. The combined company will employ about 17,000 people, have cash of nearly $300m and a productive capacity substantially in excess of current sales. Advanced Micro made a small loss on sales of $632m in the year to March; Monolithic had profits of $7.2m on $100m sales in its fiscal first half.
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