By DREW KERR
dkerr@poststar.com
Updated: Thursday, February 19, 2009 1:19 AM EST
Advanced Micro Devices shareholders have given company officials the go-ahead to join forces with an Abu Dhabi investment company to build a $4.6 billion computer chip factory in Saratoga County.
The affirmation comes a week after the company failed to garner the majority of voters needed to approve the deal during a meeting in Austin, Texas. At the time, just 42 percent of the company's shareholders had voted, although AMD officials said 97 percent of the votes cast were in favor of the deal.
On Wednesday, the company reported that just over 50.3 percent of its shareholders had voted and that 94.5 percent of them supported the transaction.
With the vote done, AMD will be able to close on a partnership with Advanced Technology Investment Co., an investment firm funded by the Abu Dhabi government.
AMD and the Investment company will form a new company, temporarily called The Foundry Co., that will be responsible for overseeing construction of a 1.3 million-square-foot computer chip factory at the Luther Forest Technology Campus in Malta and Stillwater.
As part of the transaction, AMD will issue 58 million shares of common stock and warrants to buy another 35 million shares to the Mubadala Development Co., an investment firm wholly owned by the Emirate of Abu Dhabi.
Mubadala, which will initially oversee ATIC's interest in The Foundry Co., will now own around 19 percent of AMD's stock.
Under the transaction's terms, ATIC will buy $700 million worth of stock in the Foundry Co., and own 65.8 percent of the company's shares. AMD will assume the remaining shares and enjoy equal voting rights in the privately owned joint venture.
ATIC will also put $1.4 billion in direct investment into The Foundry Co., money that will be used to update AMD facilities in Dresden, Germany, and to help build the New York factory.
The Foundry Co. must formally commit to the project by July in order to receive the $1.2 billion incentive packages New York state officials have offered the company to locate in the state.
The deal includes $650 million in cash and a series of tax credits.
AMD officials said they want close with ATIC by March 2, allowing them to launch the partnership's new brand and logo.
The company will also then be able to purchase 222 acres of land at Luther Forest, split between Malta and Stillwater, for a price of between $7 million and $8 million.
AMD spokesman Travis Bullard said Wednesday that details of the land buy are still being finalized, but that a deal could be struck "shortly after" AMD and ATIC close on their partnership.
The company would then issue a letter to the state citing its commitment to the project, he said.
Company officials have said they would like to begin clearing the site as early as next month, and want the plant to begin producing the first computer chips by 2012. They want the site to be fully operational by 2014.
AMD is leasing a 9,000 square-foot office at the Saratoga Technology and Energy Park, also in Luther Forest, to house employees during construction.
Some hires have already been made, and full-time employees, including some local residents, could begin working in the area in a matter of weeks, Bullard said.
A team of 40 to 50 people will eventually be brought in to oversee the construction of the plant, but remaining hires are not expected to come until closer to the 2012 startup date.
Once finished, the plant is expected to employ more than 1,400 people, 60 percent of whom will work as factory technicians.
The plant is expected to carry an annual payroll of $88 million.
The development may also spark the creation of another 5,000 ancillary or support jobs in the region, according to an economic impact study commissioned by AMD.
Michael Relyea, the executive director at Luther Forest, has said that the addition of two other manufacturers at the technology park, in addition to some smaller support businesses, could mean another 5,000 to 10,000 new local jobs.
The build-out at the park is expected to take around a decade, he said.
Officials in the town of Malta, meanwhile, continue to examine site plans recently submitted by AMD.
The town needs to issue soil disturbance and building permits before the company can begin clearing the site and constructing the factory.
The town Planning Board has not yet made any judgments on the new plans, but the item is on its Feb. 24 agenda.
The meeting will be held at 6:15 p.m. at Malta Town Hall, 2540 Route 9.
