Feb. 26 (Bloomberg) -- Shares of Advanced Micro Devices Inc., the second-largest maker of personal-computer microprocessors, rose the most in two months on speculation the company may be acquired.

The shares gained 99 cents, or 6.7 percent, to $15.68 at 4 p.m. New York time in Nasdaq Stock Market trading. The stock has fallen 23 percent this year.

``There's speculation that there's going to be a takeover, but I think it's incorrect,'' said Eric Ross, an analyst at ThinkEquity Partners in New York. Ross doesn't own Advanced Micro shares and rates them ``sell.''

Investors are speculating that either International Business Machines Corp. or a group of private-equity companies is considering a purchase of Sunnyvale, California-based Advanced Micro, Ross said. He said he thinks neither rumor is true.

Advanced Micro Devices spokesman Drew Prairie declined to comment. IBM spokesman John Bukovinsky said the company doesn't comment on rumors and speculation.

Advanced Micro and IBM have a partnership on chip research and design.

Private-equity companies, including a group led by Blackstone Group LP that bought Freescale Semiconductor Inc. for $17.6 billion last year, have become interested in semiconductor makers because of their low debt levels and ability to generate cash.

A buyer won't find that at Advance Micro, because the company incurred debt last year during its $5.4 billion purchase of ATI Technologies Inc. and plans to increase spending on new plants, ThinkEquity's Ross said.

``They shouldn't be looking at it if they are,'' Ross said. ``The problems that they think that they can correct are not that easily correctable.''

To contact the reporters on this story: Ian King in San Francisco at ianking@bloomberg.net

Last Updated: February 26, 2007 16:12 EST