Advanced Micro Devices, the perpetual No. 2 to Intel in PC microprocessors, said Tuesday it would sell its corporate campus in Austin, Texas, and then lease it back. The transaction will generate $164 million in much-needed cash for Sunnyvale, Calif.-based AMD.
The campus will be sold to real-estate firm Spear Street Capital and is expected to close on March 26. The sale is part of a strategy to get rid of non-core investments and double down on the core business of making microprocessors for PCs and other devices. Unfortunately, it also seems like the kind of move that healthy companies wouldn’t make.
“As we reset and restructure AMD for long-term success, we are taking a number of steps designed to optimize our business and monetize assets,” said Devinder Kumar, chief financial officer of AMD. “The sale of our Austin campus will unlock a significant amount of capital, while the multi-year lease back of our Austin campus reconfirms our long-term commitment to the city that so many AMD employees have called home since 1979.”
AMD has mroe than 1,900 employees in Austin. The company will take a charge of $50 million as it books a loss on the selling price compared to the carrying value of the property. Nokia did the same thing with its Helsinki headquarters in December, raising $220 million. AMD lost $1.18 billion in 2012.
But AMD said that it is in the midst of turning itself around. The company recently announced a deal to supply combo graphics-microprocessor chips to Sony for the PlayStation 4. It announced its Richland mobile computer chip platform and new Radeon graphics chips recently.