AMD to buy ATI

AMD the chip manufacturer giving Intel a run for its money in the CPU wars has now agreed to purchase the Canadian graphics chip company ATI for $5.4 billion in cash and stock.

AMD just makes CPUs while rival Intel makes embedded graphics controllers for motherboards etc, with this purchase AMD get the capability and can better compete with Intel.

AMD also have agreements with NVidia a major rival to ATI but AMD say this will not effect the relationship.

If all goes well the deal should complete in the 4th quarter of this year.