Tag: investment

Coronavirus forces a change in investment plans

The coronavirus crisis has pushed companies to review their investment strategies to survive according to M&A integration expert Mike Kiersey, Principal Technologist at Boomi.

Kiersey said that corporations like Mitsubishi are undergoing a major shift, where M&As play a crucial role – sparking the question of how to integrate both parties.  As the transition to digital speeds up, it can be expected that we will see a rise in mergers and acquisitions after the pandemic.

AMD might get lots of Chinese cash

 Photo of China from satellite - Wikimedia CommonsThe dark satanic rumour mill has manufactured a hell on earth yarn which suggests that AMD might be set to expand thanks to wodges of Chinese cash being thrown at it.

Since Intel paid AMD a billion for its anti-trust doings,  AMD’s bottom line has not been that good.

However it is still in a good position to churn out processors and video cards. This would make it a good deal for a buy out.  Some have suggested Samsung, but others Qualcomm.

But there is also one name which is cropping up on the rumour mill a lot more — a Chinese company called BLX IC Design Corp.

The sticking point to any buy out is that it would require the renegotiation of the licence with Intel over the x86 architecture, however an investment by a third company would work. Trade restrictions by the US government could prevent an outright purchase by an institution run by the Chinese government, but the US loves Chinese cash.

BLX has collaborated with AMD in the past, and does not need to buy the company to get what it wants.

The rumour, looked at  by Tom’s Hardware suggests that BLX IC Design could buy a share of AMD .  It controls the manufacturer of microprocessors Loongson Technology (MIPS architecture, family Godson), may make a strategic investment in technologies and products from AMD with the Chinese Academy of Sciences.

The Chinese chip designer could provide enough money to AMD to increase its capacity for research and development. The budget of AMD in research and development for this quarter will be about $ 200 million, well below the historical spending. As the company’s sales are shrinking, will not increase spending in this area, which could jeopardize its future and the long-term survival.

AMD bosses were in Beijing in late January and early February for meetings related to the possible deal.

Armed with Chinese cash, AMD could damage Intel with projects like Zen and K12 and put the fear of god into Nvidia. Its new partners could help it make inroads into the huge Chinese market and provide the Chinese semiconductor industry with much needed patents and R&D.

 

UK business “confidence” slips to record levels

ukflagAccountancy firm BDO has released a report that suggests business confidence is at a 21 year low in British history.

The company’s BDO Optimism Index, which has been running for 21 years and looks at emerging trends over the following two quarters, dropped to 88.9 in January compared to a reading of 90.3 in December, which is the eighth month in a row that the index has been below the growth metric of 95.0. According to BDO, this suggests trouble for Q1 2013, especially taking figures from the Office for National Statistics into account that threatened a triple dip recession.

BDO’s Output Index, which looks at and predicts turnover expectations, also fell – supporting a looming triple dip recession as it dropped from 93.1 to 92.3, again short of the 95.0 growth mark.

Although the outlook is bleak, BDO believes there are small signs of improving confidence, such as in the company’s Employment Index, which rose to 95.1 in January from 93.0 in December. This is the first time it has passed the 95.0 mark since last April, and also supported the ONS’ data on unemployment dropping in the three months to November. Manufacturer confidence should also be reason for some cautious optimism, which rose to 95.2 in January compared to 91.9 in December.

Partner at BDO LLP, Peter Hemington, said in a statement that despite strengthening in labour, “business confidence continues to weaken, and improved hiring intentions are not translating into growth plans”.

“It sees the damaging effects on businesses of five years’ zigzagging economic growth,” Hemington said, leaving them “wary” of making expansion or investment plans. A crucial tonic for bringing the economy out of a slump, according to BDO, will be providing growth incentives.