Abu Dhabi to take over chip-maker

DUBAI, United Arab Emirates — The Abu Dhabi government agreed last week to acquire full control of Advanced Micro Devices Inc.’s former microchip manufacturing unit, though AMD will remain a key customer.

AMD is giving up its minority stake in Milpitas, Calif.based manufacturer GlobalFoundries as part of a revised supply agreement. The deal will give Abu Dhabi’s Advanced Technology Investment Co. total ownership of Globalfoundries, which was founded as a spinoff from AMD in 2009.

While AMD will remain one of Globalfoundries’ “strategic customers,” it will now be better positioned to diversify its customer base, Advanced Technology Investment Co. communications head Laurie Doyle Kelly said.

“It can really pursue its strategy and mandate of being a fully independent foundry,” she said in an interview.

A foundry does the work of manufacturing chips for microprocessor designers such as AMD that do not operate their own production plants. Sunnyvale, Calif.-based AMD is the world’s No. 2 maker of personal computer microprocessors — the “brains” of PCS — after Intel Corp.

In addition to giving up its less than 10 percent stake, AMD said it will pay GlobalFoundries $425 million as part of the deal. It expects to book a one-time charge of $703 million in the first quarter to cover the cash payment and other costs.