Abu Dhabi’s Mubadala sells 34.9 million shares in US chipmaker AMD

Abu Dhabi’s Mubadala Investment Co has sold 34.9 million common equity shares in Advanced Micro Devices (AMD), a company spokesperson said on Tuesday, and plans to convert 75 million warrants in the US chipmaker.

Mubadala did not disclose the sale price; but the market value of the 34.9 million shares was about $842m based on Monday’s closing price.

The Abu Dhabi state fund, which has stakes in General Electric and private equity firm Carlyle Group, first invested in AMD in 2007. AMD is a supplier of standard computer microprocessors, and rivals Intel Corp and Nvidia Corp.

Mubadala will continue to be a major shareholder in the global semiconductor firm after the transaction, with ownership of about 6.9 per cent, once the 75 million warrants are converted to common equity shares, the company said.

The state fund has been trimming its stake in AMD in recent years. Mubadala had an initial stake of 12.9 per cent in the chipmaker, according to its annual report for 2017 financial year.

“Today’s transaction remains in line with Mubadala’s overall investment strategy to monetise mature holdings to deliver attractive commercial returns,” Brian Lott, a spokesman with Mubadala said.

Converting the warrants will provide AMD with $448.5m, Mubadala said in a statement issued in Abu Dhabi.

Recent activity

Mubadala had a busy end to 2018, purchasing a 20 per cent interest in Egypt’s Nour North Sinai offshore concession from Italy’s Eni in November, and signing an agreement worth over Dhs1bn with Emirates Global Aluminium (EGA) to develop a new power and water desalination plant at EGA’s smelter in Dubai’s Jebel Ali in October.

Also in November, the state fund led a $60m Series B funding for US-based Turvo – the world’s first real-time collaborative logistics platform.

In September, Mubadala announced a first half group profit of Dhs10.9bn ($2.97bn), boosted by the sale of part of its stake in BP and the solid performance of other stocks in its portfolio.

Earlier in the year, in March, Abu Dhabi Investment Council (ADIC) was merged with the fund, following on from 2017’s merger between state investor International Petroleum Investment Company (IPIC), and Mubadala Development Company – a union that created Mubadala Investment Company.