As part of its financial results disclosure this afternoon, AMD has just announced that it is spinning off a portion of its operations into a joint venture with Nantong Fujitsu Microelectronics (NFME).
The new joint venture will absorb AMD's assembly, test, mark, and pack (ATMP) operations, including two production sites, one in Penang, Malaysia and the other in Suzhou, China, along with about 1,700 employees. NFME will pay AMD $371 million and will receive 85% ownership of these operations, while AMD will retain a 15% stake.
The announcement says no "workforce reductions" are planned as part of the exchange.
This deal doesn't sound especially exciting, but it is a small echo of AMD's decision years ago to sell off its chipmaking facilities to GlobalFoundries and become a "fabless" semiconductor company. Going forward, AMD will be a smaller company, and it will have to rely on outside firms, including this joint venture, to handle assembly and test duties for its chips. In return, AMD will no longer have to support an operation that might be sitting idle when its chips aren't selling well, and it gets something else a struggling company needs: cash to fund the development of future products.
AMD says the deal should close in the first half of next year, assuming the firms are able to get the necessary regulatory approvals.