AMD agrees $1.9bn cloud purchase

June 2022 | DEALFRONT | MERGERS & ACQUISITIONS

Financier Worldwide Magazine

June 2022 Issue

In a bid to bolster its data centre products and capitalise on booming demand from cloud and enterprise sectors, multinational semiconductor company AMD has acquired cloud start-up Pensando in a transaction valued at $1.9bn.

Founded in 2017, Pensando’s distributed services platform includes a high performance, fully programmable packet processor and comprehensive software stack that accelerate networking, security, storage and other services for cloud, enterprise and edge applications.

Moreover, Pensando’s products are deployed at scale across cloud and enterprise customers, including Goldman Sachs, IBM Cloud, Microsoft Azure and Oracle Cloud. Its high performance, highly scalable distributed services platform includes a programmable packet processor that can be distributed throughout a network to efficiently accelerate multiple infrastructure services simultaneously.

“We are excited to join the AMD family,” said Prem Jain, chief executive of Pensando. “Our shared cultures of innovation, excellence and relentless focus on partners and customers make this an ideal combination. Together, we have the talent and tools to deliver on our customers’ vision for the future of computing.

“In less than five years Pensando has assembled a best-in-class engineering team that are experts in building systems together with a rich, deep ecosystem of partners and customers who have currently deployed over 100,000 Pensando platforms into production,” he continued. “Joining together with AMD will help accelerate growth in our core business and enable us to pursue a much larger customer base across more markets.”

For more than 50 years, AMD has driven innovation in high-performance computing, graphics and visualisation technologies. Its employees are focused on building high performance and adaptive products that push the boundaries of what is possible. Billions of people, leading Fortune 500 businesses and cutting-edge scientific research institutions around the world rely on AMD technology.

“To build a leading-edge data centre with the best performance, security, flexibility and lowest total cost of ownership requires a wide range of compute engines,” said Lisa Su, chair and chief executive of AMD. “All major cloud and original equipment manufacturer (OEM) customers have adopted EPYC processors to power their data centre offerings.

“With our acquisition of Pensando, we add a leading distributed services platform to our high-performance CPUs, graphics processing units (GPUs), field programmable gate arrays (FPGAs) and adaptive systems on a chip (SoC) portfolio,” she continued. “The Pensando team brings world-class expertise and a proven track record of innovation at the chip, software and platform level which expands our ability to offer leadership solutions for our cloud, enterprise and edge customers.”

The acquisition is expected to close in the second quarter of 2022, following satisfaction of customary closing conditions, including approval under the Hart-Scott-Rodino Antitrust Improvements Act of 1976.

Acting as financial adviser to AMD is DBO Partners, while Latham & Watkins LLP is serving as legal adviser. Centerview Partners is acting as financial adviser to Pensando and Wilson Sonsini Goodrich & Rosati is serving as legal counsel.

John Chambers, chair of the board of Pensando, concluded: “Pensando’s leadership position in software-defined cloud, compute, networking, security and storage services as part of the much larger AMD portfolio is a perfect fit to shape the data centre computing landscape for the next decade.”

Fraser Tennant