AMD planning to buy AGEIA?

Posted on Thursday, Nov 22 2007 @ 17:19 CET by Thomas De Maesschalck
CustomPC claims AMD is considering to buy PhysX maker AGEIA but that the high price would be a problem as AMD is in a need of cash right now:
AMD’s head of developer relations, Richard Huddy, told Custom PC that ‘we’ve had that discussion, yes. It’s a discussion that goes round every three months – someone turns to me and says ‘why don’t we buy Ageia?’ and I go through the arguments about why we should and why we shouldn’t.’

Despite, Ageia’s disappointing games-support for its PhysX chip, the company's PhysX software is free, and has accordingly been used widely, even if the PhysX hardware itself isn’t supported. As such, buying Ageia could give AMD a chance to continue to compete in the gaming physics arena now that Intel has bought Havok.

The main problem, according to Huddy, is the price. ‘Our biggest problem is that Havok reputedly cost in excess of $100 million,’ says Huddy. ‘If I’d been valuing Havok, I’d have valued it at probably something like 10 per cent of that because they were in so much trouble in the marketplace, but realistically they did have some valuable IP, and you really can capitalise on that if you’re Intel in this situation.’

‘If Ageia want to command a comparable price,’ said Huddy, ‘then that’s a pretty significant problem for AMD. No one would think of us as cash rich at the moment, so splashing an extra $100 million just to get physics, which is a niche market, is quite an issue for us.’

About the Author

Thomas De Maesschalck

Thomas has been messing with computer since early childhood and firmly believes the Internet is the best thing since sliced bread. Enjoys playing with new tech, is fascinated by science, and passionate about financial markets. When not behind a computer, he can be found with running shoes on or lifting heavy weights in the weight room.

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