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AMD denies sale rumours

Chip maker AMD has denied reports that is preparing to be sold, after Reuters reported that the company has hired bankers JPMorgan to explore options.

AMD also denied that it is preparing to sell its portfolio of patents, saying 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," said a spokesperson for the company in an email to E&T.

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.

Since the 1980s, AMD has competed with much larger Intel and at times has made inroads with its PC and server chips. But setbacks at AMD limited those gains and it now faces new competition from companies designing low-cost and power-efficient chips based on Cambridge-based ARM's technology.

Like Intel, AMD was caught flat-footed in recent years with the emergence and fast growth of mobile devices. But while Intel has deep pockets to fund research on new products to catch up, AMD faces declining cash flows and a more modest balance sheet.

Rory Read took over as AMD's CEO in 2011 promising to fix long-standing execution problems that have plagued the chipmaker. But AMD has continued to lose money as well as market share to Intel and graphic chip rival Nvidia.

AMD said last month it would slash 15 per cent of its workforce, while devoting more resources to areas outside of its traditional PC business, including server, communications, industrial and gaming applications.

AMD recently announced it has licensed technology from ARM and will use it to build low-power chips for servers. But those products aren't expected to launch until 2014 and AMD is one of several companies vying for a microserver market that will be small compared to traditional servers that power most data centres

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