Chip firm Advanced Micro Devices (AMD) will end up with a smaller share in manufacturing spin-off the Foundry Company as a result of the economic woes in the world.
AMD will now own only 34 per cent of the joint venture conducted with Abu Dhabi financial investors. The original deal meants AMD would own 44 per cent of the JV.
And that's not the only change to the agreement, set to be finalised in the New Year.
AMD wants to spin off the Foundry Company to act as a factory to make its chips, and also to act for third parties. But in recent weeks it's apparent that there's a slowdown in the foundry market, with TSMC and UMC forcing their staff to take unpaid holidays.
Mubadala, one of the Abu Dhabi players, was originally set to pay $314 million for 58 million AMD shares but that's now conditional on how the shares fare, based on an average closing price in a 20 day period up to 12th of December, or 20 days before to the deal closes, whichever is the lower.
Right now, AMD's share price stands at $2.10. Under the terms of the deal, the Abu Dhabu powers will put $1.4 billion into the joint venture and pay $700 million to the chip firm. That still stands.
Last week, AMD said that its revenues for the current financial quarter were adversely affected by the economic meltdown. X