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Advanced Micro Shareholders Approve Manufacturing Spinoff

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enigma067   02-18-2009 at 08:16:59 PM

Advanced Micro Shareholders Approve Manufacturing Spinoff
Dow Jones
February 18, 2009: 11:44 AM ET

NEW YORK -(Dow Jones)- Advanced Micro Devices Inc. (AMD) shareholders Wednesday approved what is the final step toward a spinoff of the company's manufacturing operations, in a deal designed to improve AMD's balance sheet and refocus the company on designing chips instead of making them.

More than 94% of shareholders voted to allow AMD to issue stock and warrants that will effectively let the company spin off its manufacturing facilities into a joint venture known as the Foundry Co., formed with the Advanced Technology Investment Co., an Abu Dhabi investment fund.

The deal includes an investment by Mubadala Development Co., also of Abu Dhabi, of roughly $800 million.

Shares of AMD traded recently at $2.46, up 9 cents, or 3.8%.

Last week, the Sunnyvale, Calif., maker of chips for computers and servers postponed a scheduled shareholder meeting because the company failed to meet the required 50% quorum.

Roughly 97% of the votes cast before the earlier meeting were in favor of the deal.

-By Jerry A. DiColo; Dow Jones Newswires; 201-938-5670; jerry.dicolo@ dowjones.com

(END) Dow Jones Newswires
02-18-09 1144ET
Copyright (c) 2009 Dow Jones & Company, Inc.

http://money.cnn.com/news/newsfeed [...] RTUNE5.htm

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fazers_on_stun   02-18-2009 at 09:52:20 PM
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And as of 3:50PM EST, shares of AMD traded down 15 cents or 6.3%.

You should make a YooToob video of the above report - much more interesting :)

Reply to fazers_on_stun
jimmysmitty   02-19-2009 at 02:30:57 AM
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But of course they would be in favor of the deal. It means more money to put in their pockets.

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Shadow703793   02-19-2009 at 03:12:07 AM
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You realize Hector is getting a raise because of this? And he will lead the The Foundry Company as an executive?

 
Quote :

Ruiz, who has been heavily criticized for his poor management of AMD after the departure of the legendary Jerry Sanders, will become the Chairman of The Foundry Company.


Quote :


A point of contention was raised by an angry shareholder at the meeting, who pointed out that AMD's board of directors approved a $3,000,000 transaction bonus to Hector Ruiz, AMD's Executive Chairman.


http://www.dailytech.com/article.aspx?newsid=14309

 

They really should hire a new guy. Bring Sanders back!


Message edited by Shadow703793 on 02-19-2009 at 03:19:00 AM
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fazers_on_stun   02-19-2009 at 04:19:09 AM
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jimbo75 wrote :

It's worth remembering that personal failure still usually ends up with losing your head in UAE. That's exactly what AMD needs, and it's why Intel will be crapping their pants.



If that were even remotely true, I would think Hector would be the one crapping his pants :sol: He has a history of failure - Motorola, AMD and soon the Lost&Foundry :)

Reply to fazers_on_stun
fazers_on_stun   02-19-2009 at 08:16:45 PM
- 0 +

jimbo75 wrote :

It's amazing how fast people forgot that Ruiz oversaw AMD's best financial quarters. Without the aquisition of ATI, AMD would have no roadmap and Intel would currently be researching the amazing 65nm, 1.8ghz dual-core Nehalem gaming cpu. :D



Quarters as in 25 cents, or quarters as in 1/4th of a year? :)

Correct me if mistaken, but didn't Ruiz just ride in on Sander's coattails with K8? I mean, all the heavy lifting was done on Sander's watch; he retired and then Ruiz found himself in the glory spotlight.

Besides, anybody with the gall to actually take their $14M paycheck + incentives while AMD was gushing red arterial blood, should have their heads chopped off at noon on Friday! Or so says Ayatollah UAyeMeanie.

As for the Intel holding back progress remarks, don't you think Intel wants to drive the upgrade market as well? Why wouldn't they invest R&D dollars, come out with new products, and make an upgrade attractive so as to drive new business?

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roofus   02-19-2009 at 09:00:32 PM
- 0 +

of course they approved it. this is their life support machine. without it they were as good as gone. in spite of popular fanboi belief, this doe not mean what money Dhabi is there for the taking lol
i am glad they got the lifeline. prior to the Phenom 2 release i honestly felt they deserved to perish for ineptitude and bad decision making. The Foundry deal will either be the best decision they ever made or a slow, painful handing over of power to the Dhabi interests. i dont think they will succeed in gaining access to more cash beyond the original agreement without relinquishing more control of their company which will distance itself further from what it used to be.

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Reply to roofus
fazers_on_stun   02-20-2009 at 07:20:29 PM
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roofus wrote :

of course they approved it. this is their life support machine. without it they were as good as gone. in spite of popular fanboi belief, this doe not mean what money Dhabi is there for the taking lol
i am glad they got the lifeline. prior to the Phenom 2 release i honestly felt they deserved to perish for ineptitude and bad decision making. The Foundry deal will either be the best decision they ever made or a slow, painful handing over of power to the Dhabi interests. i dont think they will succeed in gaining access to more cash beyond the original agreement without relinquishing more control of their company which will distance itself further from what it used to be.



My take is that Abu Dhabi is willing to continue investing, but they are going to want a return on that investment, so expect them to pass some of those fab costs to AMD right off the bat, and unless the Foundry can attract other customers besides AMD, then eventually AMD will be paying those fab upgrade costs in the form of much higher wafer prices.

Ordinarily a customer could just go shopping elsewhere to get a better price on fabbing, but AMD is stuck with the x86 license that prohibits something like >25% outsourcing, IIRC. So that means 75% of those CPUs will have to be made in the Foundry.

The best scenario for AMD is for the world economy to rebound this year, and enable the Foundry to be able to get outside customers in a hurry so as to amortize the fab upgrade costs over more customers than just AMD. Otherwise, with the extra overhead, AMD will wind up paying everything it would have if it had kept the fab, plus extra.

Reply to fazers_on_stun
jimmysmitty   02-21-2009 at 11:07:09 AM
- 0 +

fazers_on_stun wrote :

Quarters as in 25 cents, or quarters as in 1/4th of a year? :)

Correct me if mistaken, but didn't Ruiz just ride in on Sander's coattails with K8? I mean, all the heavy lifting was done on Sander's watch; he retired and then Ruiz found himself in the glory spotlight.

Besides, anybody with the gall to actually take their $14M paycheck + incentives while AMD was gushing red arterial blood, should have their heads chopped off at noon on Friday! Or so says Ayatollah UAyeMeanie.

As for the Intel holding back progress remarks, don't you think Intel wants to drive the upgrade market as well? Why wouldn't they invest R&D dollars, come out with new products, and make an upgrade attractive so as to drive new business?



Because only AMD would do that...... We all know, according to thunderman, Intel is EVIL and doesn't care about anything else but AMD, his masters (I am guessing the weird kind....), are not.

Don't forget that.

:kaola:

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