14 DAY TRIAL // Advanced Micro Devices and Qualcomm Incorporated have announced recently that Qualcomm has purchased graphics and multimedia technology assets from AMD, as well as intellectual property and resources that constituted the basis of AMD’s handheld business. Through this acquisition, Qualcomm leverages its multimedia capabilities and also reinforces its position in delivering next-generation products to mobile users.
“This acquisition of assets from AMD’s handheld business brings us strong multimedia technologies, including graphics cores that we have been licensing for several years,” Steve Mollenkopf, executive vice president of Qualcomm and president of Qualcomm CDMA Technologies, said. “Bringing this technology in-house creates even greater synergy, as we seamlessly integrate the best-in-class multimedia performance AMD offers into our system-on-chip (SoC) products.”
“With the sale of these handheld technology assets and resources to Qualcomm, we are better able to focus on our core business and leverage our unique position as a leader in both x86 computing and high-end graphics,” Robert J. Rivet, chief operations and administrative officer, and chief financial officer of AMD, added. “We believe the talented AMD Handheld employees will be a great asset to Qualcomm.”
According to the agreement, design and development teams from the former AMD handheld business will be offered employment by Qualcomm. The teams work on the development of new technologies that could leverage the capabilities of mobile devices in terms of 2D and 3D graphics, audio/video and architecture.
The regulatory approvals for the deal have already been received, and the two closed a binding agreement on January 19. Qualcomm will pay AMD cash considerations of $65 million, which are stated to be the subject of different adjustments for employee-related expenses. The companies announced their commitment to a fast transfer of business assets, while employees should experience a smooth transition.
According to Qualcomm, the purchase should dilute its earnings per share for 2009 by about $0.02, while in the second half of 2010 it is expected to become profitable.