Advanced Micro woos a partner to fight Intel

Advanced Micro Devices (AMD) acquires NexGen for $860 million in stock in an effort to compete with Intel's domination of the microprocessor market. AMD's rival to Intel's Pentium microprocessor is about six months behind schedule. NexGen, on the other hand, has its own Pentium-class chip, but, with few customers and limited manufacturing capacity, the company's shipments have been limited. AMD's purchase of NexGen was essential since NexGen retains a significant technological lead over AMD. NexGen has shown a working version of a chip that rivals Intel's Pentium Pro chip, but the small company lacks its own production facilities which limits sale capabilities. Intel's 80% hold on the PC microprocessor market makes it unlikely that the AMD and NexGen collaboration will overtake Intel, but achieving the goal of increasing its market share from 17% to 30% may be possible.