Transmeta and AMD put aside their differences to give each other a shoulder to lean on

AMD last week announced a strategic monetary investment in former CPU manufacturer Transmeta, despite quickly mounting debts. Transmeta will receive $7.5 million cash -- approximately 4% of Transmeta's market capitalization -- from AMD in exchange for preferred stock.

"AMD has long been a leader in the development and delivery of energy-efficient, high-performance computing technologies, standards and initiatives," stated Transmeta president and CEO Les Crudele. "Transmeta has been proud to endorse and contribute to those industry leading activities, and we look forward to continuing our collaboration with AMD on technology initiatives in the future."

Transmeta posted a net loss of near $24 million for fiscal 2006; AMD posted a net loss of $611 million for the first quarter of 2007.

Last year, AMD closed the doors of its Geode and Alchemy divisions. Both divisions produced low-power processors that directly competed with Transmeta's Crusoe and Efficeon family. AMD then spun off the remnants of its Alchemy division to Raza Microelectronics, leaving AMD with an x86-only product lineup.

AMD hopes to take advantage of energy-efficient Transmeta technology to benefit AMD products and customers. AMD President and COO Dirk Meyer claims, "Transmeta was a key ally in helping to bring our highly-successful AMD64 technology to market and has supported the widespread industry adoption of both AMD64 and AMD’s HyperTransport technology."

Last February, Transmeta cut its workforce by 39% to focus its interests on just intellectual property. For the majority of 2007, Transmeta's primary revenue prospect revolves around an open patent infringement lawsuit aimed at Intel over ten patents allegedly found in low-power Intel processorsIntel immediately counter-sued over this claim.

Unlike the acquisition of ATI, this is only an investment in Transmeta by AMD. The companies have not announced any plans of collaboration.

"Vista runs on Atom ... It's just no one uses it". -- Intel CEO Paul Otellini
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