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AMD Gives Up Remaining Globalfoundries Shares, Pays $425M

By - Source: AMD | B 28 comments

There is a new agreement between AMD and GlobalFoundries that transfers AMD's remaining 8.8 percent ownership in the foundry to ATIC.

As a result, AMD has become a fabless chip designer as of today. AMD announced in October 2008 that it would spin off its manufacturing business as part of a restructuring effort.

Additionally, GlobalFoundries and AMD agreed to end an agreement that gave GlobalFoundries the exclusive right to manufacture "certain 28 nm products", which opens the door for AMD to approach other foundries to balance its processor manufacturing strategy and secure capacity as well as supply. The new agreement, which will require AMD to pay GlobalFoundries $425 million in cash, also includes a term that releases AMD from quarterly payment obligations of GlobalFoundries as part of a contract that was signed last year.

In a prepared statement, AMD CEO Rory Read was quoted saying that "the amended wafer supply agreement demonstrates that AMD and GlobalFoundries remain committed as long-term strategic business partners. We made significant progress last year to strengthen our relationship, and we're pleased with GlobalFoundries' recent performance in meeting our delivery requirements across our product line."

It appears that AMD is going to great lengths to get out of the exclusivity agreements with GlobalFoundries. The company said that the move will cost about $703 million in total - which includes a non-cash charge of $278 million in addition to the $425 million cash payment.

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  • 22 Hide
    ChiefTexas_82 , March 6, 2012 1:42 PM
    Global Foundries, You ARE the weakest link! Goodbye!
  • 20 Hide
    nforce4max , March 6, 2012 1:53 PM
    I wish that AMD didn't have to pay any thing at considering how much they have lost over the years because of GF. Poor yields and semi functional samples that amd is often forced to sell into retail channels is killing the company.
  • 18 Hide
    ikefu , March 6, 2012 1:10 PM
    Maybe Global Foundries will finally have some pressure to get their yields up to par with other fabs around the world. Intel is bashing AMD over the head with their fabs since AMD was stuck with the lack luster efforts of GF.
Other Comments
  • 18 Hide
    ikefu , March 6, 2012 1:10 PM
    Maybe Global Foundries will finally have some pressure to get their yields up to par with other fabs around the world. Intel is bashing AMD over the head with their fabs since AMD was stuck with the lack luster efforts of GF.
  • 22 Hide
    ChiefTexas_82 , March 6, 2012 1:42 PM
    Global Foundries, You ARE the weakest link! Goodbye!
  • 0 Hide
    de5_Roy , March 6, 2012 1:51 PM
    now amd will soar in the sky, flying through all the negativism, like a shining bright light amidst monopoly, price fixing and underhanded tactics. they will make so much profit that intel will be caught off guard. amd will bathe in the sweet water of success.
  • 20 Hide
    nforce4max , March 6, 2012 1:53 PM
    I wish that AMD didn't have to pay any thing at considering how much they have lost over the years because of GF. Poor yields and semi functional samples that amd is often forced to sell into retail channels is killing the company.
  • 18 Hide
    slabbo , March 6, 2012 2:13 PM
    nforce4maxI wish that AMD didn't have to pay any thing at considering how much they have lost over the years because of GF. Poor yields and semi functional samples that amd is often forced to sell into retail channels is killing the company.


    ya, i totally agree, it should be the other way around. GF should be paying AMD for all the crap they caused, and AMD is giving up its shares of the company, they just can't get a break.
  • 5 Hide
    theuniquegamer , March 6, 2012 3:23 PM
    Very very wisely decided by AMD to break relation ship with that faulty wafer manufacturer (GF). Because of them AMD has to sell lock the faulty cores of a quad cores and sell it at a lower price of a dual core.
  • 1 Hide
    cookoy , March 6, 2012 3:58 PM
    Reading only the headline: You give up your remaining shares in GF and you pay $425m. Confusing. Then you read the details: You have a new agreement to pay the $425m to end an old exclusivity agreement with GF. You're pleased with GF performance yet you're willing to pay $703m to get the f* out of an exclusivity deal with them.
  • 4 Hide
    fuzznarf , March 6, 2012 4:15 PM
    it was well worth it for AMD to get out. A small price to pay for the flexibility and security that comes with diversifying amongst 3rd party manufacturing. Not only can AMD now shop other chip manufacturers, but they are now able to set up AMD-controlled production if needed. I wouldn't be surprised if AMD started to set up their own gpu production within the next 2 years.
  • -4 Hide
    Anonymous , March 6, 2012 5:11 PM
    What's with the GF bashing? This was the plan all along. Let's not forget why GF was created and the financial state that AMD was in before GF was concieved. It's probably the reason AMD is still around as a contender.
  • -5 Hide
    acadia11 , March 6, 2012 5:26 PM
    Does This mean amd can now match Intelsat die shrinking capabilities or not? Otherwise who cares
  • 8 Hide
    fuzznarf , March 6, 2012 5:35 PM
    HardWorkLuckWhat's with the GF bashing? This was the plan all along. Let's not forget why GF was created and the financial state that AMD was in before GF was concieved. It's probably the reason AMD is still around as a contender.


    GF has been a source of production issues for AMD since it was conceived. AMD spun GF off to be more flexible and it became their biggest hindrance. GF never really got production up to competitive output levels and constantly had quality issues. They also were the cause of a lot of AMD's delays.
  • 5 Hide
    madooo12 , March 6, 2012 6:20 PM
    GF didn't give AMD any money for exclusivity, they only gave them bad yields and faulty chips
  • 3 Hide
    robochump , March 6, 2012 6:37 PM
    I too hope AMD once again claims the CPU performance title because this will only spur Intel and other CPU companies into tougher competition which will benefit the consumers. Intel would not have offered better products if AMD did not beat them at their won game for a period of time. Also if GF has been more of a bottleneck than a partner then the news is very welcomed!
  • -8 Hide
    ta152h , March 6, 2012 8:20 PM
    Bulldozer sucks. Global Foundries suck. It's a good fit. Where's the problem?
  • -2 Hide
    Anonymous , March 6, 2012 9:21 PM
    Global Foundries WAS AMD !!!

    http://en.wikipedia.org/wiki/GlobalFoundries

    Now AMD will have a little more flexibility in deciding who gets tender of Manufacture on their design.

    Of course AMD have to pay to get out of exclusivity contract, GF was essentially SOLD in that state to private investment Consortium with Abu Dhabi's Advanced Technology Investment Co! being the largest.

    They would have wanted AMD tied to using them for a period of time, or what would be the point in them investing!

    This still leaves AMD short on their Design front though, and that is where AMD has real issues in the CPU world.. Maybe the CPU design guys should spend more time with the GPU guys to see how to execute correctly!
  • 1 Hide
    beetlejuicegr , March 6, 2012 10:30 PM
    Damn, i still remember the times where AMD news were about cpus capable of beating intel cpus easily and were the gamer's cpu :/ 
    Now they made Intel cocky, giving a new socket every 6 months and mostly incompatible with previous sockets...
  • -1 Hide
    Marco925 , March 6, 2012 11:59 PM
    fuzzionThe last AMD product i used was the thunderbird. Ah the good ol days when you could brag to your friends that AMD was the best gaming CPU with awesome floating point calculations.

    Now are the days where i can brag that i got the best bang for the buck, and tell people just how much less i spent for a machine that performs negligibly less than an intel computer, but with many more coolass features.
  • 1 Hide
    v3rlon , March 7, 2012 12:01 AM
    AMD manufacturing wasn't this kind of problem until they spun it off into a separate organization. They did the spin off to generate some cash, which they now have to pay back to get out of using the manufacturing facilities they built because of yield issues. They could have just given the fabs away and been better off. The legacy of Hector Ruiz.
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