AMD strikes a deal to sell ZT Systems' server-manufacturing business for $3B

AMD has announced the sale of ZT Systems' server-manufacturing business to Sanmina for $3 billion, comprising $2.25 billion in cash, a $300 million premium, and a $450 million contingent payment based on future financial performance. This move follows AMD's acquisition of ZT Systems for $4.9 billion in August 2024, with the intent to divest the server-manufacturing segment post-acquisition. The deal is expected to close by the end of 2025, pending regulatory approval.

Post-divestiture, AMD will retain control of ZT Systems' rack-scale AI solutions design business and has named Sanmina as a preferred partner for new product introduction manufacturing for AMD's cloud rack and cluster-scale AI solutions. This partnership aims to enhance U.S.-based manufacturing capabilities and improve quality and time-to-market for AMD's cloud customers.

Key takeaways

AMD is selling ZT Systems’ server-manufacturing business to Sanmina for $3 billion in a mix of cash and stock.
The deal includes a $450 million contingent payment based on financial performance over the next three years.
AMD will retain control of ZT Systems’ rack-scale AI solutions design business after the divestiture.
Sanmina will become a preferred new product introduction manufacturing partner for AMD's cloud rack and cluster-scale AI solutions.

AMD strikes a deal to sell ZT Systems' server-manufacturing business for $3B | TechCrunch

Key takeaways

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