AMD to pick up Pensando for $1.9bn

Semiconductor producer AMD agreed on Monday to acquire US-based edge computing technology provider Pensando in a $1.9bn deal allowing corporates Hewlett Packard Enterprise (HPE), Equinix, Alphabet, Ericsson, NetApp, Oracle, Liberty Global and Qualcomm to exit.

Pensando has developed a distributed, programmable processor and software platform to help customers’ existing network architecture function more like cloud networks in order to support high-velocity applications.

The company claims its technology yields eight to 13 times better performance than competitive products, and the purchase would help AMD compete with the likes of Nvidia and Intel’s data centre chip businesses.

Enterprise technology producer HPE and venture capital firm Lightspeed Venture Partners co-led a 2019 series C round sized at up to $145m for the company at a $645m valuation that was announced as it came out of stealth, investing with data centre operator Equinix to boost its overall funding to $278m.

The company subsequently received an undisclosed amount of funding in from chipmaker Qualcomm’s corporate venturing unit, Qualcomm Ventures, in late 2020.

Qualcomm Ventures then joined communications equipment maker Ericsson and mass media group Liberty Global’s corporate VC subsidiaries, Ericsson Ventures and Liberty Global Ventures, to add almost $35m in additional funding in August 2021.

Internet and technology conglomerate Alphabet’s GV subsidiary is also listed as an investor on the company’s website, as are cloud data services provider  NetApp, investment banking firm Goldman Sachs and JC2 Ventures.

Pensando CEO Prem Jain said: “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.

“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.”

DBO Partners is financial adviser for AMD on the deal while Latham & Watkins is legal adviser. Centerview Partners is Pensando’s financial adviser and Wilson Sonsini Goodrich & Rosati legal counsel.

Image courtesy of Pensando.