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AMD Completes ATI Acquisition and Creates Processing Powerhouse


    AMD (NYSE:AMD) today announced the completion of its approximately
    $5.4 billion acquisition of ATI Technologies Inc. Combining the
    complementary strengths of the two technology leaders, the new AMD
    opens for business as a processing powerhouse committed to driving
    innovation, choice and growth in the technology industry. With
    approximately 15,000 employees, the company merges AMD's technology
    leadership in microprocessors together with ATI's leadership in
    graphics, chipsets and consumer electronics.

    "Today marks a historic day for our employees, our partners and
    our customers as we officially welcome ATI into the AMD family," said
    AMD Chairman and CEO Hector Ruiz. "On day one, we are delivering a
    winning set of complementary technologies, igniting a new level of
    innovation and continuing to champion choice for the industry. Thanks
    to the strength of our talented employees, the new AMD now has a full
    range of intellectual property (IP) in microprocessors, graphics,
    chipsets and consumer electronics to deliver open platforms and
    integrated solutions. In the near term, customers gain a new level of
    choice, and in the long term, we believe the possibilities for
    innovation are truly limitless."

    Transaction Details

    Under the terms of the transaction, AMD acquired all of the
    outstanding common shares of ATI for a combination of approximately
    $4.3 billion in cash and 58 million shares of AMD common stock, based
    on the number of shares of ATI common stock outstanding on October 24,
    2006. All outstanding options and restricted stock units (RSUs) of ATI
    were assumed. The value of the ATI acquisition of approximately $5.4
    billion is based upon the closing stock price of AMD common stock on
    October 24, 2006 of $20.32 per share and excludes the value of assumed
    equity awards.

    AMD financed the cash portion of the transaction with a
    combination of cash and new debt. AMD obtained a $2.5 billion term
    loan from Morgan Stanley Senior Funding, Inc., which, together with
    combined existing cash, cash equivalents, and marketable securities
    balances of approximately $1.8 billion, provided full funding for the
    transaction.

    AMD announced the final pro-ration applicable to ATI common shares
    in the acquisition. The total consideration to be paid for each common
    share, based on the Parent Closing Stock Price (as defined in the Plan
    of Arrangement, as amended), is approximately $21.36. The final
    election results indicate that pro-ration is as follows:

    -- ATI shareholders who elected to receive cash will be entitled
    to receive, for each common share for which a valid cash
    election was made, approximately US $18.59 in cash plus
    approximately 0.1245 of a share of AMD common stock;

    -- ATI shareholders who elected to receive stock will be entitled
    to receive, for each common share for which a valid stock
    election was made, 0.9596 of a share of AMD common stock; and

    -- ATI shareholders who did not make a valid election will be
    entitled to receive, for each share for which no valid
    election was made, 0.9596 of a share of AMD common stock.

    Pro-ration was necessary because the cash consideration elected to
    be received exceeded the amount of cash available in the acquisition.
    Any fractional shares will be paid in cash.

    Planning to Deliver Integrated Platforms in 2007

    Customers should benefit from AMD's and ATI's combined platform
    development and technical support teams, which will be co-located in
    Taipei and Shanghai. Combined with the existing Austin and Toronto
    locations, these sites offer research and development and support to
    provide customers with a complete solution for optimized platform
    development.

    AMD plans to deliver a range of integrated platforms in 2007 to
    serve key markets, including: commercial clients; mobile computing;
    and gaming and media computing. PC users will benefit from innovations
    intended to extend battery life on the next-generation AMD Turion(TM)
    64 mobile technology-based platform and enhancements to the AMD
    LIVE!(TM) digital media PC platform that will enable users to get more
    from their favorite photos, music, and movies. AMD believes that these
    integrated platform innovations will bring customers improved system
    stability, better time-to-market, increased performance and
    energy-efficiency and overall, an enhanced user experience.

    "By driving innovation and integration in processing, especially
    in graphics, the new AMD has the potential to empower breakthrough
    computing experiences for users of Windows(R) Vista,(TM)" said Jim
    Allchin, Co-President of Microsoft's Platforms & Services Division.
    "We are excited by the potential benefits that this union can bring to
    enhance the Windows Vista experience."

    AMD also sees an opportunity to deliver processing solutions to
    the growing consumer electronics market. The company intends to
    leverage ATI's strength in the consumer market by pursuing new
    opportunities to invest in the consumer electronics and high-end
    discrete graphics markets. With leading technology and customer
    relationships, AMD is positioned to address digital convergence by
    leveraging critical IP to create new innovations and devices that
    facilitate end-to-end content delivery and connectivity to improve
    end-user experiences.

    CPU/GPU Silicon "Fusion" - Another Industry First for Customers

    AMD plans to create a new class of x86 processor that integrates
    the central processing unit (CPU) and graphics processing unit (GPU)
    at the silicon level with a broad set of design initiatives
    collectively codenamed "Fusion." AMD intends to design Fusion
    processors to provide step-function increases in performance-per-watt
    relative to today's CPU-only architectures, and to provide the best
    customer experience in a world increasingly reliant upon 3D graphics,
    digital media and high-performance computing.

    With Fusion processors, AMD will continue to promote an open
    platform and encourage companies throughout the ecosystem to create
    innovative new co-processing solutions aimed at further optimizing
    specific workloads. AMD-powered Fusion platforms will continue to
    fully support high-end discrete graphics, physics accelerators, and
    other PCI Express-based solutions to meet the ever-increasing needs of
    the most demanding enthusiast end-users.

    "With the anticipated launch of Windows Vista, robust 3D graphics,
    digital media and device convergence are driving the need for greater
    performance, graphics capabilities, and battery life," said Phil
    Hester, AMD senior vice president and chief technology officer. "In
    this increasingly diverse x86 computing environment, simply adding
    more CPU cores to a baseline architecture will not be enough. As x86
    scales from palmtops to petaFLOPS, modular processor designs
    leveraging both CPU and GPU compute capabilities will be essential in
    meeting the requirements of computing in 2008 and beyond."

    Fusion processors are expected in late 2008/early 2009, and the
    company expects to use them within all of the company's priority
    computing categories, including laptops, desktops, workstations and
    servers, as well as in consumer electronics and solutions tailored for
    the unique needs of emerging markets.

    About AMD

    Advanced Micro Devices (NYSE: AMD) is a leading global provider of
    innovative processing solutions in the computing, graphics and
    consumer electronics markets. AMD is dedicated to driving open
    innovation, choice and industry growth by delivering superior
    customer-centric solutions that empower consumers and businesses
    worldwide. For more information, visit www.amd.com.

    Safe Harbor Statement

    This release contains forward-looking statements, which are made
    pursuant to the safe harbor provisions of the U.S. Private Securities
    Litigation Reform Act of 1995. Forward-looking statements are commonly
    identified by words such as "proposed," "may," "expected," and other
    terms with similar meaning. Forward-looking statements are based on
    current beliefs, assumptions and expectations and speak only as of the
    date of this release and involve risks and uncertainties that could
    cause actual results of the combined company to differ materially from
    current expectations. The material factors and assumptions that could
    cause actual results to differ materially from current expectations
    include, without limitation, the following: revenue, cost savings,
    growth prospects and any or other synergies expected from the proposed
    transaction may not be fully realized or may take longer to realize
    than expected; the transaction may not be accretive as expected; the
    combined company may not achieve any year-end or longer-term targeted
    gross margins, research and development expenses, selling, general or
    administrative expenses, operating margins, capital structure or
    debt-to-capitalization ratio; the combined company may require
    additional capital and may not be able to raise sufficient capital, on
    favorable terms or at all; delays associated with integrating the
    companies, including employees and operations; the possible impairment
    of goodwill and other long-lived assets resulting from the transaction
    and the resulting impact on the combined company's assets and
    earnings; unexpected variations in market growth and demand for the
    combined company's products and technologies; rapid and frequent
    technology changes in the computing and consumer electronics segments;
    potential constraints on the ability to develop, launch and ramp new
    products on a timely basis; research and development costs associated
    with the development of new products and other factors that may affect
    future results of the combined company described in the section
    entitled "Risk Factors" in the management information circular that
    was mailed to ATI's shareholders and in AMD and ATI's filings with the
    U.S. Securities and Exchange Commission ("SEC") that are available on
    the SEC's web site located at http://www.sec.gov, including the
    section entitled "Risk Factors" in AMD's Form 10-Q for the fiscal
    quarter ended July 2, 2006 and the section entitled "Risks and
    Uncertainties" in Exhibit 1 to ATI's Form 40-F for the fiscal year
    ended August 31, 2005. Please see Item 3.12 "Narrative Description of
    the Business - Risks and Uncertainties" in ATI's 2005 Annual
    Information Form and the Risks and Uncertainties section of ATI's
    annual MD&A on page 30 of ATI's 2005 Annual report filed on the SEDAR
    website maintained by the Canadian Securities Administrators at
    http://www.sedar.com. Readers are strongly urged to read the full
    cautionary statements contained in those materials. We assume no
    obligation to update or revise any forward-looking statement, whether
    as a result of new information, future events or any other reason.

    AMD COMPLETES ACQUISITION OF ATI QUOTE ADDENDUM

    NVIDIA Corporation

    "NVIDIA and AMD have innovated together for over a decade. As a
    result, NVIDIA GeForce and nForce processors set the standard for AMD
    systems. AMD's open platform strategy enables continued partnership
    aimed at providing customers with a wide choice of industry leading
    solutions," said Dan Vivoli, executive vice president, NVIDIA
    Corporation.

    DELL

    "Dell is focused on enhancing our customers' individual and
    organizational computing experience with a standards-based and
    solutions approach to IT investment. AMD shares this commitment, and
    its acquisition of ATI provides an excellent opportunity for further
    innovation and new opportunities for Dell customers," said Jeff
    Clarke, senior vice president, Product Group, Dell.

    HP

    "AMD and ATI are longtime HP partners who share our passion for
    delivering innovative solutions to customers. The combination of these
    companies should help the industry deliver richer computing platforms
    to enterprises and consumers around the world," said Shane Robison,
    executive vice president and chief strategy and technology officer,
    HP.

    LENOVO

    "The AMD-ATI combination provides a strong new solution with a
    wide range of product offerings that ensures OEMs have a choice when
    planning to deliver products to market," said Gerry Smith, senior vice
    president, global supply chain, Lenovo.

    ASUSteK Computer Inc

    "We are excited about the newly-combined company's focus on
    innovation and the potential for new opportunities and solutions in
    notebook and desktop computing. We recognize that this union could
    potentially inspire new technologies, platforms or form factors," said
    Jerry Shen, vice president, ASUSteK Computer Inc.

    Broadcom

    "Broadcom has a strong track record of providing leading
    technology to the server market," said Ford Tamer, senior vice
    president and general manager of Broadcom's Enterprise
    Networking Group. "We value our partnership with AMD. And as strong
    technology partners, we'll continue to jointly deliver high
    performance enterprise products to our customers, including Broadcom's
    industry-leading Ethernet controllers and server I/O platform
    solutions."