Advanced Micro Devices Inc. will hold a meeting in Austin, Texas, at which shareholders will vote on its $7.2 billion plan to spin off manufacturing.
The Desmond
The date for the vote has not yet been decided, although some details of the proposal to be put before shareholders were released in documents filed Wednesday with the U.S. Securities and Exchange Commission.
The shareholder vote holds the key to AMD's plans to build a $4.6 billion computer chip factory at Luther Forest Technology Campus in Malta through a joint venture with the Emirate of Abu Dhabi called The Foundry Co.
Although it is officially based in Sunnyvale, Calif., AMD has significant operations in Austin. It is also the city where most of the company's executive management team lives.
AMD shareholders must approve the creation of Foundry and the spinoff of AMD's two factories in Germany that will form the centerpiece of the deal — which also includes building the Luther Forest fab.
As its name suggests, the new company will be a "foundry" that makes microprocessors for AMD and other firms.
The documents filed Wednesday with the SEC do not shed any light on how AMD's deal with Abu Dhabi unfolded or when discussions began.
However, they do reveal that AMD must pay Abu Dhabi a $50 million penalty if the chipmaker were to be acquired or tries to arrange a deal with another company before this one is completed.
One of the conditions of the Abu Dhabi deal is approval by the Committee on Foreign Investment in the United States, a Treasury Department board that vets foreign investment for national security issues.
The SEC documents say Abu Dhabi can get out of the deal if its proposed investment in Foundry is eventually referred to the President of the United States, who can block the transaction. Such referrals are rare.
The documents also shed light on AMD's reasons for the deal with Abu Dhabi, beyond the fact that the company has been suffering financially and the spinoff is expected to help the chipmaker's balance sheet and make it profitable again. The documents essentially describe a changing world in which chip companies are relying more and more on foundries for their manufacturing.
"The semiconductor industry is undergoing a profound transformation," AMD says. "Vertically integrated companies are abandoning plans to invest in new capacity and manufacturing technology while announcing plans to outsource a growing percentage of their wafer requirements. Captive volumes can no longer support the cost of building leading-edge capacity and process technology investments."
AMD likely will file revised documents soon with the SEC that will set a date for the shareholder vote. Those documents also could include additional details of the transaction.
Source : http://timesunion.com/
The Desmond
The date for the vote has not yet been decided, although some details of the proposal to be put before shareholders were released in documents filed Wednesday with the U.S. Securities and Exchange Commission.
The shareholder vote holds the key to AMD's plans to build a $4.6 billion computer chip factory at Luther Forest Technology Campus in Malta through a joint venture with the Emirate of Abu Dhabi called The Foundry Co.
Although it is officially based in Sunnyvale, Calif., AMD has significant operations in Austin. It is also the city where most of the company's executive management team lives.
AMD shareholders must approve the creation of Foundry and the spinoff of AMD's two factories in Germany that will form the centerpiece of the deal — which also includes building the Luther Forest fab.
As its name suggests, the new company will be a "foundry" that makes microprocessors for AMD and other firms.
The documents filed Wednesday with the SEC do not shed any light on how AMD's deal with Abu Dhabi unfolded or when discussions began.
However, they do reveal that AMD must pay Abu Dhabi a $50 million penalty if the chipmaker were to be acquired or tries to arrange a deal with another company before this one is completed.
One of the conditions of the Abu Dhabi deal is approval by the Committee on Foreign Investment in the United States, a Treasury Department board that vets foreign investment for national security issues.
The SEC documents say Abu Dhabi can get out of the deal if its proposed investment in Foundry is eventually referred to the President of the United States, who can block the transaction. Such referrals are rare.
The documents also shed light on AMD's reasons for the deal with Abu Dhabi, beyond the fact that the company has been suffering financially and the spinoff is expected to help the chipmaker's balance sheet and make it profitable again. The documents essentially describe a changing world in which chip companies are relying more and more on foundries for their manufacturing.
"The semiconductor industry is undergoing a profound transformation," AMD says. "Vertically integrated companies are abandoning plans to invest in new capacity and manufacturing technology while announcing plans to outsource a growing percentage of their wafer requirements. Captive volumes can no longer support the cost of building leading-edge capacity and process technology investments."
AMD likely will file revised documents soon with the SEC that will set a date for the shareholder vote. Those documents also could include additional details of the transaction.
Source : http://timesunion.com/
