ATI hasn't acquired XGI, but it did say yesterday it has bought some of the Taiwanese graphics chip company's US-based staff. It also said it has snapped up Microsynergy, an XGI partner based in Shanghai.

ATI CEO Dave Orton said the move gives the company a foothold on mainland China in a city central to China's booming technology industry. "The XGI and Macrosynergy people bring additional breadth of knowledge and experience," he added. They are "highly skilled in our key product areas".

ATI's interest in XGI was rumoured last week, though neither company chose to comment on the speculation that ATI was about to buy its much smaller rival. Speculation was fuelled by XGI's decision to move away from desktop graphics and focus on embedded applications instead. It's highly likely, then, that ATI's new US hires were formerly working on desktop products at XGI.

XGI - aka Xabre Graphics Incorporated - was spun out from Taiwanese chipset maker SiS in 2003. It quickly acquired US-based Trident Microsystems' graphics chip division. Later that year, it dropped the Xabre brand, choosing the word 'Volari' to brand its products instead. ®