Advanced Micro Devices (AMD) said Monday it has signed a definitive agreement to sell ZT Systems' data center infrastructure manufacturing business to Sanmina (SANM) in a cash-and-stock transaction valued at $3 billion.

The consideration includes a contingent payment of up to $450 million and is subject to customary adjustments for working capital and other items, AMD said.

As part of the deal, Sanmina becomes a preferred new product introduction manufacturing partner for AMD cloud rack and cluster-scale AI solutions, while will retain ZT Systems' design and customer enablement teams, AMD said.

AMD said it expects the transaction to be completed near the end of 2025.

AMD shares were down more than 2% in recent premarket activity while Sanmina shares traded up 0.5%.