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[AMD] AMD and Nantong Fujitsu Microelectronics Co., Ltd to Establish Industry-Leading Semiconductor Assembly and Test Joint Venture

post #1 of 129
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AMD and Nantong Fujitsu Microelectronics Co., Ltd to Establish Industry-Leading Semiconductor Assembly and Test Joint Venture
Quote:
$436 million agreement combines AMD's high-volume ATMP facilities with Nantong Fujitsu Microelectronics' OSAT expertise to service broad range of customers

Latest step in AMD's strategic transformation further sharpens focus and operations on designing high-performance products

AMD to contribute Penang and Suzhou assembly and test manufacturing facilities, including approximately 1,700 employees and management team

Nantong Fujitsu Microelectronics to take 85% ownership and serve as controlling shareholder, paying AMD approximately $371 million in cash

AMD (NASDAQ: AMD) and Nantong Fujitsu Microelectronics Co., Ltd (NFME) (SZSE: TFWD) today announced the signing of a definitive agreement to create a joint venture combining AMD's high-volume assembly, test, mark, and pack (ATMP) facilities and experienced workforce in Penang, Malaysia and Suzhou, China with NFME's established outsourced semiconductor assembly and test (OSAT) expertise. Upon close, the new business will leverage the capabilities of 5 facilities and approximately 5,800 employees to offer differentiated ATMP capabilities and scale to service a broad range of customers. The transaction is expected to close in the first half of 2016, pending successful completion of regulatory approvals.

"We continue our strategic transformation by creating a joint venture combining AMD's high-volume assembly, test and packaging facilities and our experienced workforce with NFME's expertise in outsourced semiconductor assembly and testing," said AMD Senior Vice President, Chief Financial Officer and Treasurer Devinder Kumar. "NFME is an ideal partner with the vision and business plan to successfully lead the joint venture upon the close of the transaction. We continue to sharpen the focus of our ongoing investments on designing differentiated, high performance technologies and products that can drive long term profitable growth. The formation of this JV further strengthens our balance sheet with significant asset monetization."
Shi Lei, the general manager of NFME, said, "AMD has world-class advanced assembly and testing facilities and a rich history of high-volume production.

AMD's technology and expertise is very complementary to our current capabilities. The newly-formed JV will improve NFME's R&D capability and enhance our corporate reputation worldwide. The JV will also strengthen our opportunities to further move into international markets and secure additional customers as a part of our plans to become one of the world's leading assembly and testing companies."

The joint venture marks another step in AMD's strategic plan to sharpen its focus on building great products while enhancing the company's supply chain operations in the long run by providing additional scale and strengthening its balance sheet through a cash infusion and reduced capital expenditures aligned with a fabless business model.

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post #2 of 129
Basically AMD is hurting for cash and is willing to give up control for that cash. Yeah they made $371 million on the deal, but they gave up controlling interest and they are losing $200 million a quarter. So basically, the sale bought AMD 6 months.
post #3 of 129
Oh look, those of us talking about AMD selling off in parts or whole for the last several months weren't crazy.

rolleyes.gif

Pay attention kidos, maybe the old farts still have a thing or two to teach you.
    
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post #4 of 129
Fujitsu huh? Ya they are still big, just not heard of very often. I didnt see them coming.

Quote:
Originally Posted by 47 Knucklehead View Post

Basically AMD is hurting for cash and is willing to give up control for that cash. Yeah they made $371 million on the deal, but they gave up controlling interest and they are losing $200 million a quarter. So basically, the sale bought AMD 6 months.

2 possibilities. Either Fujitsu plans on spending a substantial sum to both keep AMD afloat for now and to begin turning things in the direction they want and will re-evaluate in a year if they want to keep AMD afloat. Or Fujitsu plans on selling off AMD for parts very soon.
Personally, I think this will let China being to take some much needed technology and processors into their supercomputer initiative since the Intel deal a bit ago was blocked. Fujitsu would need to keep AMD alive for that though.
Edited by EniGma1987 - 10/15/15 at 4:03pm
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post #5 of 129
Quote:
Originally Posted by PostalTwinkie View Post

Oh look, those of us talking about AMD selling off in parts or whole for the last several months weren't crazy.

rolleyes.gif

Pay attention kidos, maybe the old farts still have a thing or two to teach you.

Bingo thumb.gif
post #6 of 129
Quote:
Originally Posted by EniGma1987 View Post

Fujitsu huh? Ya they are still big, just not heard of very often. I didnt see them coming.
2 possibilities. Either Fujitsu plans on spending a substantial sum to both keep AMD afloat for now and to begin turning things in the direction they want and will re-evaluate in a year if they want to keep AMD afloat. Or Fujitsu plans on selling off AMD for parts very soon.
Personally, I think this will let China being to take some much needed technology and processors into their supercomputer initiative since the Intel deal a bit ago was blocked. Fujitsu would need to keep AMD alive for that though.


Fujitsu is buying just a part of AMD.

post #7 of 129
Quote:
Originally Posted by robertparker View Post


Fujitsu is buying just a part of AMD.

Buying 85% is controlling interest to do what they want with it. If they want to sell off for parts later on getting the last 15% would be easy and hardly cost them anything.
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post #8 of 129
Quote:
Originally Posted by EniGma1987 View Post


Buying 85% is controlling interest to do what they want with it. If they want to sell off for parts later on getting the last 15% would be easy and hardly cost them anything.


That controlling interest is just in the new company.  http://www.anandtech.com/show/9723/amd-to-spinoff-backend-testing-assembly-into-joint-venture-for-371-million

 

The title is confusing on the thread.


Edited by robertparker - 10/15/15 at 4:34pm
post #9 of 129
Quote:
Originally Posted by robertparker View Post


That controlling interest is just in the new company.  http://www.anandtech.com/show/9723/amd-to-spinoff-backend-testing-assembly-into-joint-venture-for-371-million

The title is confusing on the thread.

ah ok thumb.gif
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post #10 of 129
Quote:
Ultimately today’s announcement of a joint venture is at best mixed news for AMD. Containing costs is important for the company’s ongoing health and clearly the company no longer has the resources or demand to stay in any kind of manufacturing. On the other hand as the company continues to sell off assets in one form or another – and all the while continues to lose cash as happened again this quarter – it puts them in a perilous position of having to operate off of fewer and fewer assets.
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  • [AMD] AMD and Nantong Fujitsu Microelectronics Co., Ltd to Establish Industry-Leading Semiconductor Assembly and Test Joint Venture
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