Intel Rebuffed Proposal to Acquire SeaMicro Before AMD Deal

Intel Corp. (INTC), inflaming a long- running feud with Advanced Micro Devices Inc. (AMD), said it turned down a chance to buy SeaMicro Inc. before AMD agreed to acquire the startup last week.

Intel decided against an acquisition because it “wasn’t impressed” with SeaMicro’s technology, Diane Bryant, who runs the data-center chip business at the Santa Clara, California- based semiconductor maker, said today.

The startup offered itself to multiple possible acquirers, according to Bryant, who made the comments at a San Francisco event marking the introduction of a new line of server chips. Intel dominates the market for processors that power machines in corporate networks and data centers -- an area where SeaMicro has made inroads.

“There’s very few people that they didn’t shop their solution to,” she said. “We were not impressed and declined.”

When AMD announced the acquisition last week, SeaMicro Chief Executive Officer Andrew Feldman said he had multiple offers before deciding to sell the company to AMD. He declined to identify other parties interested in a deal. SeaMicro, which currently uses Intel chips, makes so-called micro servers -- machines that handle tasks such as opening Web pages and logging on customers to their online accounts.

The SeaMicro purchase will bring valuable intellectual property, said Phil Hughes, a spokesman for Sunnyvale, California-based AMD.

“With the acquisition of SeaMicro, we believe we will have the best server IP portfolio in the marketplace,” he said.

Intel, the world’s largest chipmaker, rose less than 1 percent to $26.61 at the close in New York. AMD dropped 2.4 percent to $6.90.

To contact the reporter on this story: Ian King in San Francisco at ianking@bloomberg.net

To contact the editor responsible for this story: Tom Giles at tgiles5@bloomberg.net

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