AMD buys Alchemy Semiconductor for PDA processors

Moving into the handheld computing space, Advanced Micro Devices Inc. (AMD) on Wednesday announced the acquisition of Alchemy Semiconductor Inc.

The acquisition allows AMD, one of the world’s leading computer processor makers, to expand its processor business to handheld devices such as personal digital assistants (PDAs), the company said in a statement.

The new business will be part of a newly created business unit, dubbed Personal Connectivity Solutions, that will focus on non-PC connectivity devices, AMD said.

“This is quite an exciting announcement. It allows AMD to move in the low-power handheld processor market, where its presence has been pretty much zero,” said Andrew Brown, research manager mobile computing at analyst firm IDC.

Alchemy Semiconductor, privately held and founded in 1999, sells MIPS-based processors for what it calls the Internet Edge Device market, which it says includes wireless PDAs, information appliances and remote Internet access products. However, the company’s founders also have a history of chips based on ARM Ltd.’s core, AMD said.

ARM-based processors are gaining popularity in PDAs. Most PocketPC devices have processors based on ARM, and Palm Inc., which currently uses Motorola Inc.’s DragonBall processor for most of its handhelds, is moving to ARM-based processors.

IDC’s Brown expects AMD to get into the ARM-based market.

“I think that is the only way to go forward,” he said. “MIPS had a greater presence in the past, but the market (now is) divided up into DragonBall and ARM.”

The acquisition is expected to be completed in the first quarter of this year, AMD said. Terms of the deal were not disclosed.

IDC is a division of International Data Group Inc., the parent company of IDG News Service.

AMD, in Sunnyvale, California, can be reached at +1-408-732-2400 or

Alchemy Semiconductor in Austin, Texas, can be reached at +1-512-421-6200 or on the Web at