AMD to acquire SeaMicro for $334 mn

Chip-maker AMD today said it has signed a definitive agreement to acquire California-based SeaMicro for nearly $334 million, a move that will help strengthen its foothold in the lower-power computer server space.

Through the acquisition of SeaMicro, AMD will be accelerating its strategy to deliver server technology to OEM (original equipment manufacturers) customers serving cloud-centric data centers, AMD said in a statement.

Of the $334 million, about $281 million will be paid in cash, it added.

SeaMicro is a pioneer in energy-efficient, high-bandwidth microserver manufacturing.

AMD's server technology combined with SeaMicro's would provide customers with a range of processor choices and platforms that would help significantly reduce data centre complexity, cost and energy consumption, while improving performance.

AMD plans to offer the first AMD Opteron processor-based solutions that combine AMD and SeaMicro technology in the second half of 2012.

"By acquiring SeaMicro, we are accelerating AMD's transformation into an agile, disruptive innovator capable of staking a data center leadership position," AMD president and CEO Rory Read said.

The transaction is expected to be accretive to earnings after 2012 and AMD will fund the cash portion of the acquisition with existing cash reserves.