Source: Sharecast
Under the deal, the European semiconductor contract manufacturing group will supply a range of chip solutions for Amazon Web Services' data centres, which it says will help AWS address the rising demand for compute performance, efficiency and data throughput required for growing AI and cloud workloads.
As part of the deal, AWS will acquire up to 24.8m shares in ST through warrants that will vest in tranches over a seven-year period.
The agreement set an initial exercise price of $28.38 per US-listed ST share, slightly lower than Friday's closing price of $29.83 but in line with the stock's level for most of January.
“This strategic engagement establishes ST as an important supplier to AWS and validates the strength of our innovation, proprietary technology portfolio, and proven manufacturing-at-scale capabilities," said ST president and chief executive Jean-Marc Chery.
"Our advanced semiconductor solutions will directly power AWS’s next-generation infrastructure, enabling their customers to push the boundaries of AI, high-performance computing, and digital connectivity."
STMicroelectronics' stock on Wall Street was trading 8.9% higher at $32.52 by 1636 GMT, while Amazon slipped 0.2% to $209.87 GMT.