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AMD Now Owns Biggest Chunk of Transmeta

Its recent investment could make it the largest common shareholder.

Advanced Micro Devices'

(AMD) - Get Advanced Micro Devices, Inc. Report

recent investment in troubled

Transmeta

(TMTA)

has made it the company's largest stakeholder.

According to a filing with the

Securities and Exchange Commission

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on Friday, AMD received 1 million shares of Transmeta Series B preferred stock in exchange for the $7.5 million "

strategic investment" it made in the company last week.

The preferred shares are convertible to 14.3 million shares of Transmeta common stock, which would represent a 6.7% stake in the company. That would give AMD a bigger stake in Transmeta than any other institutional or individual shareholder.

According to LionShares Web site, the single largest individual shareholder is Transmeta co-founder and former CEO David Ditzel, who has a 5.4% stake. Barclays Global Investors 3.4% position makes it the largest institutional shareholder prior to AMD's investment.

Transmeta recently transformed itself into a provider of intellectual property, after failing to succeed as a stand-alone maker of low-power microprocessors. Since the start of the year, the company has laid off roughly two-thirds of its employees, leaving a 65-person workforce. In May, Transmeta reported a loss of $18.7 million in its fiscal first quarter.

The company is also at risk of having its shares delisted form the Nasdaq exchange due to its failure to meet the minimum $1 bid price listing requirement.

AMD said it was investing in the chipmaker to support its technology development work and to leverage its innovative energy-efficient technologies to the benefit of AMD's customers.

Shares of Transmeta were off 3 cents at 77 cents in midday trading Friday. AMD was off 10 cents to $15.26.