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Advanced Micro Devices (NYSE: AMD), Intel's smaller rival, said it will sever corporate ties with Abu Dhabi's GlobalFoundries in a bid to recover independent status as a top chip designer.

Rather than hold a minority stake in GlobalFoundries, which received all of the Sunnyvale, Calif., company's chip factories in 2009, AMD will sell out, paying GlobalFoundries $425 million. As well, it will incur a $703 million one-time charge for the first quarter.

Shares of AMD fell 39 cents to $7.07.

The move is the second in days by new AMD CEO Rory Read to make big changes at the chip pioneer whose microprocessors compete with Intel as the second source for the world's makers of PCs and servers. Last week, AMD said it will acquire privately held SeaMicro, a developer of smaller, low-energy chips, for servers. The cost is $334 million.

Read, 49, a former president of China's Lenovo Group, an AMD customer, only took over at the semiconductor giant in August.

AMD, though, will remain a customer of GlobalFoundries, which is completing a $4 billion factory in Malta, N.Y., and also has control of other former AMF factories worldwide, including Germany. GlobalFoundries also acquired Chartered Semiconductor in Singapore for $1.8 billion.

GlobalFoundries is owned by an entity of the Abu Dhabi government known as Advanced Technology Investment Co., which was established to allow the oil-rich kingdom to acquire international assets in technology.