AMD to Buy National Semi Unit

Purchase of National Semiconductor's Information Appliance unit will enable AMD to offer x86 architecture chips in thin clients, smart displays and set-top boxes.

Advanced Micro Devices Inc. is buying a unit of National Semiconductor Corp. that makes processors for such products as thin clients, blade servers and other electronic devices.

Officials at AMD, in Sunnyvale, Calif., said the deal for National Semiconductors Information Appliance unit—which primarily manufactures the Geode chip family—will enable the company to offer x86 architecture chips in thin clients, smart displays and set-top boxes.

Financial terms of the deal, announced Wednesday, were not disclosed. The acquisition is expected to close at the end of the month, according to AMD.

"With this acquisition, AMD would be the only company with the assets, dedicated resources and strategic vision to deliver a common, industry-standard architecture from embedded applications to mobile, desktop and servers," AMD President and CEO Hector Ruiz said in a prepared statement.

Brian Halla, chairman, president and CEO of National Semiconductor, announced in February that the Santa Clara, Calif., company was putting its Information Appliance and Cellular Baseband units up for sale.

The moves were part of a larger plan to save money and streamline operations that also included cutting about 500 jobs. Halla at the time said that while he expected both businesses would grow, the company could no longer invest in them while it focused on its analog business in such areas as wireless handsets and flat-panel displays.

Three months later, the company announced it was shutting its cellular baseband business and cutting its 340 jobs.

"This deal makes sense for both companies," Halla said in a prepared statement. "This allows National Semiconductor to focus on growing our core analog business and improving our returns. At the same time, AMD will be able to leverage the Geode technology through their existing manufacturing and marketing infrastructure."