Thursday, February 19, 2009

AMD plans proceed following shareholder OK

With Wednesday’s shareholder approval for investments in a microchip fabrication plant to be built in Malta, all eyes now turn to planning the new facility.

“The site plan has been generally known for years now. This is really just looking at the nuts and bolts. There are no surprises; we’re just getting through the due diligence,” said Tony Tozzi, Malta director of Building and Planning, shortly after a vote in Austin, Texas, that rubber-stamped the deal between microchip manufacturer AMD and its two investors, the Advanced Technology Investment Company and the Mubadala Development Company.

ATIC and Mubadala are wholly-owned by the Emirate of Abu Dhabi. Once the deal is formalized, a new company — thus far known as The Foundry, but expected to be renamed — will take over operation of AMD’s manufacturing facilities in Dresden, Germany, as well as the planned facility in Malta.

The decision to move forward with the deal by shareholders comes a week after the company failed to reach a quorum and take a vote, delaying the deal’s approval.

“This morning’s vote finalizes efforts in creating ‘The Foundry Company,’ it is a positive step forward during these very difficult times,” state Senator Roy McDonald said. “Upstate New York is in desperate need of quality jobs and careers. While there is much more work to be done, this is a major start toward ensuring the creation of those jobs and rebuilding our upstate economy.”

Michael Relyea, president of Luther Forest Technology Campus, the site of the new chip plant, said through a publicist he was not available for comment Wednesday.

Officials at the Saratoga County Economic Development Corporation did not return calls for comment.

Travis Bullard, spokesman for AMD, said the new company’s name and brand would be revealed on or around March 2, when AMD and its investors are expected to formalize the agreement approved Wednesday.

Once signed, ATIC will invest $1.2 billion in the venture and will spend an additional $6 billion to build the Malta fabrication facility. Mubadala will invest $314 million in AMD. In addition, the agreement will allow ATIC/AMD to receive $1.2 billion in incentives from New York state.

Once completed, the plant is expected to employ about 1,400 people.

Following the transition, ATIC will operate the fabrication facilities, while AMD will continue to develop computer chips and will contract manufacturing through ATIC.

In the beginning of March, the company will purchase a 220-acre parcel in the Luther Forest Technology Park, in advance of beginning construction. Bullard said the exact price is still being negotiated, but would likely be between $7 million and $8 million.

Harry Wolin, senior vice president and senior counsel for AMD, said at the meeting Wednesday morning that under the agreement, AMD will retain 34.5 percent ownership in the new company.

After closing voting, Bob Marsh, another AMD official, announced the tally: of 608.7 million shares, 289 million voted in favor of the venture with investors ATIC and Mubadala. Bullard said this represented 94.47 percent of the votes cast, adding that 7 million shares voted against it. About 50 percent of shares were represented in the vote.

Bullard said he did not know if individual shareholders or larger, institutional shareholders had voted against the deal.

In Malta, planners are sifting through a 1,100-page site plan in anticipation of granting site plan approval.

Under the PUD legislation crafted to guide the facility’s development, the plant will proceed under a three-phase approval process. Approval for soil disturbance is the first step, which will allow the company to begin clearing the site for construction. Subsequent phases are a temporary site plan, followed by permanent site plan approval.

“The board may be in place to take action on March 10 on the first of those steps,” said Tozzi.

Bullard said a tentative construction schedule on file with Malta slated ground breaking to occur around June 16, however the facility will first need a building permit, and Tozzi said that such documentation for such a large project will require some review.

While he said the site plan is a relatively standard document for a project of this size, the construction documents were expected to be much more complex.

“Two-hundred-twenty acres is about the same size as a subdivision anywhere in Saratoga County,” he said. “However, as a building, it’s the highest classification on the state’s building code. The difference between looking at a single family home and looking at a mall is like the difference between looking at a mall and looking at AMD. That’s the kind of scale.”

“They have to submit the full building plan before they can get a permit. Because of the size of the projects, we’ll be bringing in a consultant to help with review,” Tozzi said.

Looking al Luther Forest

Total acreage:

22.45 acres (163.4 in Malta, 54.41 in Stillwater)

Fabrication facility:

883,000 square feet


220,000 square feet

Central utility building and “spine”:

224,220 square feet

Unoccupied ancillary buildings:

33,699 square feet

Source :