I have uploaded packages based upon upstream 2.7.7.4 that should fix
this issue for most hardware configurations.

A known exception is hardware booting off General Software BIOS, on
which there are issues with X server 1.3 and newer, more specifically
with the x86emu component of X server, that cause a complete hardware
freeze. General Software has been notified through various channels.

Gutsy packages (source and binary) can be found at:
http://q-funk.iki.fi/debian/pool/x/xserver-xorg-video-amd/

Hardy packages are being synchronized from Debian and should be
available soon.

-- 
amd driver fails to autoconfigure
https://bugs.launchpad.net/bugs/140051
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