According to this recent article on The Inquirer, if AMD weren't to purchase ATI? they would've eventually perished.
THE AMD ATI MERGER is a done deal finally, or at least it will be in an hour or three. The deal is flat out necessary for the survival of AMD, and it is a strategic rather than a tactical move for the company.
Anyone who looks at this with a time horizon of only a quarter or four is doing themselves and the companies involved a major disservice. Also, this deal has nothing to do with GPUs or chipsets, it is about the technology behind them.