Cray sells its interconnect hardware development program and related intellectual property to Intel Corporation for $140 million in cash.
"This agreement is evidence of the leadership position we've established in high performance computing, and is an exciting win for our customers, our company and our shareholders," said Peter Ungaro, president and CEO of Cray. "By broadening our relationship with Intel, we are positioned to further penetrate the HPC market and expand on our industry-leading technologies in support of our Adaptive Supercomputing vision. Our product roadmap remains intact as we continue to build the highly differentiated, tightly integrated supercomputers that our customers have come to expect from Cray. This agreement also dramatically strengthens our balance sheet and increases our options for further growth, profitability and creating shareholder value."
Highlights of the agreement include:
- Cray to receive $140 million in cash at closing;
- Cray will continue to develop, sell and support current product lines, as well as the Company's next-generation supercomputer code-named "Cascade";
- Cray has opportunities to leverage important differentiating features of certain future Intel products;
- Cray to retain certain rights to use the transferred assets and intellectual property in Cray products;
- Up to 74 Cray employees will join Intel;
The transaction is expected to close relatively quickly, but in any event before the end of the current quarter, subject to customary closing conditions.
Cray anticipates that the lower headcount resulting from this transaction will yield cost savings in future periods from what they would have been, with a relatively modest amount of the benefit expected in 2012.
Cray Inc. and Intel Corporation also announced today they signed a multi-year agreement to advance high-performance computing (HPC) on Intel microprocessors while delivering broad new Intel and Cray technologies in future Cray server systems. The collaboration of these two industry leaders will result in HPC systems that will help solve some of the world's most complex scientific, engineering and humanitarian challenges.
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“We're excited at the potential of bringing together Intel's powerful silicon expertise and Cray's industry leadership in scalable HPC systems,” said Peter Ungaro, president and CEO of Cray. “We pride ourselves in offering the most innovative supercomputing systems and our customers will now enjoy greater choice in processor technologies.