AMD, in a strategic move to strengthen its AI ecosystem, announced the acquisition of ZT Systems for $4.9 billion. The deal, involving both cash and stock, includes an additional contingent payment of up to $400 million based on performance metrics.
ZT Systems, a New Jersey-based company specializing in compute design and infrastructure for AI, cloud, and general-purpose computing, will be integrated into AMD’s computing infrastructure design business. AMD plans to sell ZT Systems’ data center infrastructure manufacturing arm to a “strategic partner.”
The company also works closely with NVIDIA and Intel.
AMD, which has already invested $1 billion in its broader ecosystem, sees this acquisition as pivotal in enhancing its expertise in AI systems design, encompassing silicon, software, and systems. “Our acquisition of ZT Systems is the next major step in our long-term AI strategy to deliver leadership training and inferencing solutions that can be rapidly deployed at scale across cloud and enterprise customers,” stated AMD chair and CEO, Dr. Lisa Su.
ZT Systems’ CEO, Frank Zhang, will lead AMD’s manufacturing business, while President Doug Huang will oversee design and customer enablement teams, reporting to AMD’s executive vice president, Forrest Norrod. The deal is expected to finalize in the first half of 2025.
“We are excited to join AMD and together play an even larger role designing the AI infrastructure that is defining the future of computing,” said Frank Zhang, CEO of ZT Systems. “For almost 30 years we have evolved our business to become a leading provider of critical computing and storage infrastructure for the world’s largest cloud companies. AMD shares our vision for the important role our technology and our people play designing and building the computing infrastructure powering the largest data centers in the world.”
Last month, AMD announced that it has signed a definitive agreement to acquire Silo AI, which completed just last week, in an all-cash transaction valued at approximately $665 million. The acquisition is expected to close in the second half of 2024, subject to regulatory approvals.
The acquisition of ZT Systems is the latest move by AMD to bolster its AI capabilities. Over the past year, alongside ramping up organic R&D efforts, AMD has invested over $1 billion to grow its AI ecosystem and enhance its AI software expertise.
