(Column) - Let’s face it. AMD is having quite a bit of financial problems in its race against Intel to grab more market share. Although AMD has done well, and I respect them for what they have accomplished considering the sheer difference in size between the top two chip makers, they need to be put out of their misery by a company that can either take AMD out of the Intel vs. AMD race or have enough capital to give it a significant boost.

To put another dent into AMD’s lackluster performance (financial and otherwise), the ATI acquisition isn’t working out too well either. ATI is behind NVIDIA in its race against to take on the graphics market. What can I say? Things just aren’t looking rosy for AMD at this point, hence my recommendation for the acquisition.

As much as I would like to recommend private equity groups for AMD’s takeover, it’s not worthwhile. I doubt they are going to add any significant value to the company (other than injecting the company with more capital perhaps) and at worst, they are just going to drive the company into more debt with acquisition fees and other such hassles. Not to mention, the semiconductor business isn’t exactly a lucrative market to be in, as the AMD scenario appropriately depicts.

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After private equity groups, let’s look at a more strategic acquisition. For that, Apple is the best bet. Yes, I know it sounds way too radical to be taken seriously. However, Apple could drop Intel altogether and adopt AMD for its Macintosh PCs. Sure, the transition is going to take sometime, and it would probably make Apple announce a brand new line of PCs. However, it will be well worth it. We know Steve Jobs is ruthless when it comes to making interesting deals with powerful companies. This makes AMD a perfect match. Obviously Intel isn’t going to be too delighted, but other companies don’t bother Jobs. We all know he’s the type of executive who crafts deals on his own terms. If Intel wants to be associated with Apple, then they won’t really have much of a choice.

In the meantime, Apple could have AMD deal with HP, Dell and a slew of its current customers without a direct conflict of interest. Hey, it’s better than HP buying AMD and Dell having to go to HP for getting AMD chips, or vice versa. AMD acquisition by Apple makes perfect sense in as much of a non-threatening way as possible to Dell, HP and others.

Another benefit that Apple will reap out of this (other than adding another revenue stream) is to have complete control over its hardware from a cost standpoint. If it can convert Macs to AMD and ATI chips, all the key components are being developed in-house. Talk about increasing margins. Apple could either squeeze out higher margins-per-PC to lower the cost-per-Mac to allow for affordable switchover from Windows or improve its bottom line directly. Regardless of which way you cut it, Apple is going to be a winner in all of this.

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