AMD plans to sell Texas campus to raise cash
By Noel Randewich
SAN FRANCISCO (Reuters) - Advanced Micro Devices Inc plans to sell and lease back its campus in Austin, Texas, to raise cash and fund its chipmaking business as it diversifies beyond the struggling PC industry into new markets.
AMD expects to sell the 58-acre site for between $150 million and $200 million and close a deal in the second quarter, company spokesman Drew Prairie told Reuters on Tuesday.
The chipmaker's move to sell its campus, reported earlier by the Austin American-Statesman, comes as the company and its larger rival Intel Corp struggle with slowing personal computer sales.
"There are favorable economic conditions in the part of Austin where the campus is located," Prairie said. "Contingent on finding an investor who wants to do a multiyear lease-back, it's a good opportunity for us to unlock the value of the real estate to fund operations."
AMD's headquarters in Sunnyvale, California, and a building near Toronto were sold and leased back in the past, Prairie said.
The growing popularity of Apple's iPad and other tablets have sapped demand for PCs. With China's economic growth slowing while Europe's economy falters and the U.S. economic recovery is tepid, global shipments are expected to decline slightly this year - the first annual drop since 2001.
AMD, one of Silicon Valley's oldest chipmakers, has been laying off engineers while looking for new markets for its chips as it faces depleting cash reserves.
Earlier on Tuesday, AMD Chief Executive Rory Read told investors at a conference in Scottsdale, Arizona, that results from the U.S. Thanksgiving weekend look encouraging for PC sales although it is too early to make predictions about the entire holiday shopping season, and the PC industry still faces long-term problems. Continued...