AMD Set to Sell Lone Star Campus in Texas

AMD to Sell Austin, Texas Campus to Raise Cash

by Anton Shilov
11/27/2012 | 10:47 PM

“The real men have fabs,” once said Jerry Sanders, the founder of Advanced Micro Devices, implying that it takes semiconductor manufacturing fabs to be successful in the chip business over a long term. AMD has already spun off its manufacturing capacities and now plans to sell and lease back its legendary Lone Star campus in Austin, Texas.

 

In a bid to get between $150 million and $200 million, AMD wants to sell off its Lone Star campus in Austin, Texas. The company will fund chip development using the proceeds, though, it will hardly be able to significantly improve funding. For the third quarter of fiscal 2012, AMD’s research and development expenses were $328 million (down from $361 million in Q3 FY2012); whereas marketing, general and administrative expenses were $188 million (down from $249 million a year before).

"There are favorable economic conditions in the part of Austin where the campus is located. Contingent on finding an investor who wants to do a multiyear lease-back, it is a good opportunity for us to unlock the value of the real estate to fund operations," said Drew Prairie, a spokesman for AMD, in a conversation with Reuters news-agency.


AMD Lone Star campus in Austin, Texas. Image by Wildflower.org

AMD's headquarters in Sunnyvale, California, and a building near Toronto were sold and leased back in the past. However, the Lone Star campus is considered as AMD’s home as it houses many of the critical worldwide business operations of the company.

Recently AMD initiated restructuring plan that reduces costs and allows AMD to achieve break-even point with $1.3 billion quarterly revenue. The company laid-off over 1700 employees this quarter and plans to further reduce headcount in early 2013.