Qualcomm buys handheld business assets from AMD

Wireless firm seeks to bolster multimedia capabilities

Qualcomm has paid $65m for certain technology assets from AMD's handheld business

Qualcomm has acquired graphics and multimedia technology assets, including intellectual property and resources, from AMD's handheld business.

A binding agreement was signed by both firms on 19 January, after the deal received regulatory approval. Qualcomm said that it hopes the move will bolster its multimedia capabilities, and allow it to develop products which can be used in its next-generation mobiles.

"This acquisition of assets from AMD's handheld business brings us strong multimedia technologies, including graphics cores that we have been licensing for several years," said Steve Mollenkopf, executive vice president of Qualcomm and president of Qualcomm CDMA Technologies.

"Bringing this technology in-house creates even greater synergy as we seamlessly integrate the best-in-class multimedia performance AMD offers into our system-on-chip products," he added.

Under the terms of the agreement, Qualcomm has agreed to extend job offers to a number of design and development teams from AMD's handheld business. These teams will continue to work on technologies to enable more advanced 2D and 3D graphics on mobile devices, as well as enhanced video display, audio and overall architecture.

On initial reading of the details, it seemed as if the deal could involve AMD's Imageon line of graphics and multimedia chips designed for phones such as the Motorola Razr. However, AMD strongly denied this to vnunet.com.

"The agreement provides Qualcomm with certain AMD handheld multimedia, vector graphics and 3D graphics technologies and IP, as well as the transfer of human resources from AMD’s handheld business," said a spokeswoman for the chip maker. "The agreement does not include the AMD Imageon processor products, the Imageon brand, or any existing Imageon customer commitments. AMD will retain rights to the AMD Imageon products, and we intend to continue to support our current handheld customers of those products."

According to other reports, the Qualcomm purchase is based around the handheld division which AMD acquired from ATI.

The transaction involves some $65m (£46m) in cash, which Qualcomm will transfer to AMD subject to certain adjustments over employee-related expenses and any holdbacks caused by customary indemnification obligations.

Qualcomm said that it hopes the former AMD resources will begin to increase its earnings per share by the second half of 2010.