AMD splits into two companies

Chip design and manufacturing to be separated

AMD – or Advanced Micro Devices, to give the company its full title – has announced that it's splitting into two companies.

As you're probably aware, AMD is Intel's only serious rival in the computer processor market. In the future, all the design work will be done by one company (still to be known as AMD), while the manufacturing will be handled by a new one that's temporarily been dubbed the Foundry Company.

AMD will have a 44.4% stake in the new company – Advanced Technology, which was set up by the Abu Dhabi government, will own the rest.

Predictably, it seems that the main reason for the break-up is money. According to The New York Times, Advanced Technology has pledged to pump $2.1 billion into the business immediately and then invest between $3.6 and $6 billion to upgrade existing manufacturing plants or build new ones.

The move leaves Intel as the only major chip player to design and build its own products, but commentators are speculating that AMD will now be in a stronger position to challenge it.

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