AMD announced an agreement to sell the data center infrastructure manufacturing business of ZT Systems to Sanmina for up to $3 billion in cash and equity. The deal, expected to close by the end of 2025 pending regulatory approvals, includes a contingent payment of $450 million and marks a strategic step for both companies. AMD will retain ZT Systems’ AI systems design and customer enablement teams, while Sanmina becomes AMD’s preferred partner for new product introduction (NPI) manufacturing for rack and cluster-scale AI systems.
Sanmina, a global integrated manufacturing services provider, plans to integrate ZT Systems’ manufacturing capacity into its existing footprint, which includes U.S. and European operations. The acquisition significantly enhances Sanmina’s capabilities in cloud and AI infrastructure and is expected to double its revenue scale within three years. ZT Systems brings to Sanmina advanced liquid cooling capabilities and manufacturing sites in New Jersey, Texas, and the Netherlands, enabling full-system integration from components to complete racks for hyperscalers.
AMD originally announced its intent to seek a strategic manufacturing partner for ZT Systems at the time of the acquisition in August 2024. The new arrangement allows AMD to focus on design and platform enablement while leveraging Sanmina’s manufacturing scale to accelerate time-to-deployment of AI infrastructure solutions.
• Sanmina to acquire ZT Systems’ manufacturing business from AMD for up to $3B
• AMD retains ZT Systems’ design and customer enablement teams
• Sanmina becomes AMD’s preferred NPI manufacturing partner for AI systems
• Deal includes $2.25B in cash, $300M premium (50% cash, 50% equity), and up to $450M in performance-based consideration
• ZT Systems’ manufacturing business generates $5–$6B in annual revenue
• ZT Systems facilities in New Jersey, Texas, and the Netherlands expand Sanmina’s footprint
• Transaction expected to be accretive to Sanmina’s non-GAAP EPS in the first year
• Sanmina secures $2.5B in committed financing from Bank of America
“By combining the deep experience of our AI systems design team with our new preferred NPI partnership with Sanmina, we expect to strengthen our U.S-based manufacturing capabilities for rack and cluster-scale AI systems and accelerate quality and time-to-market for our cloud customers,” said Forrest Norrod, EVP and GM, Data Center Solutions at AMD.
- AMD originally announced the acquisition of ZT Systems in August 2024 for approximately $6.5 billion in cash and stock. The deal was intended to strengthen AMD’s position in cloud-scale infrastructure by adding vertically integrated rack-level design and manufacturing capabilities tailored to hyperscaler requirements. At the time, AMD highlighted ZT Systems’ deep expertise in AI systems integration, liquid cooling, and rapid customer enablement as key assets to support its growing portfolio of data center CPUs and GPUs. The company also stated that it would evaluate strategic options for the manufacturing portion of the business, leading to the current divestiture to Sanmina.
