Sunnyvale, California based Advanced Micro Devices Inc. (AMD) made two important announcements on Monday; first, the chipmaker announced that it has appointed Bruce Claflin as new chairman, to replace former CEO and Chairman Hector Ruiz, and secondly, the company announced that it has closed the deal to spin off its manufacturing operations.

AMD announced that it has tapped Bruce Claflin as its new chairman, to replace Hector Ruiz, who is retiring from the board of the company. Ruiz has been named chairman of the new company, temporarily called The Foundry Company. 

The company’s new chairman, Bruce Claflin retired as chief executive of 3Com Corp in 2006; he has been a director for AMD since August 2003. He has also held senior positions with IBM and Digital Equipment.

In a company release, AMD Chief Executive Dirk Meyer said, "Bruce Claflin brings a wealth of business experience that applies directly to the challenges and opportunities relevant to our company.”

AMD announced that Waleed Ahmed Al Mokarrab, the chairman of ATIC and the chief operating officer of Mubadala Development Company, the Abu Dhabi-based firm that is a major investor in The Foundry Company, has been named to AMD's board, while Dirk Meyer remains president and CEO of AMD.

AMD also announced that it has closed the deal to spin off its manufacturing operations to Advanced Technology Investment Company (ATIC) and Mubadala, an Abu Dhabi state-owned venture capital firm. Under the deal, ATIC invested $2.1 billion for a 65.8 percent stake of the fully converted stock in the venture. AMD received $700 million from ATIC for a portion of its ownership interests in The Foundry Company

According to the deal, the responsibility for the repayment of approximately $1.1 billion of associated AMD debt comes upon the Foundry Company, and Mubadala pays AMD approximately $125 million for 58 million newly issued AMD shares and warrants for 35 million additional shares.

According to analysts, the deal will boost AMD's financial position by approximately $825 million, excluding the value of the operations of The Foundry Company, which has a total business value of approximately $4.3 billion. AMD has 34.2 percent share, while ATIC has 65.8 percent share in The Foundry Company.

Meanwhile, the shares of AMD surged marginally in after-hours trade after dropping nearly 8 percent to $2.01 on Nasdaq in regular trading as the broader market tumbled.