Sanmina’s $3 billion acquisition of ZT Systems marks a pivotal step in expanding its footprint across the high-growth cloud and AI infrastructure markets. This move positions the company to double its revenue within three years while establishing advanced technical capabilities.
Strategic Deal Structure Enhances Long-Term Growth
Sanmina will acquire ZT Systems’ data centre manufacturing business from AMD for $2.55 billion in cash and equity. The deal also includes up to $450 million in contingent performance-based payments. The acquisition brings in $5–6 billion in annual revenue and over 30 years of integration expertise, especially in liquid cooling technology vital for AI systems.
By acquiring operations in New Jersey, Texas, and the Netherlands, Sanmina broadens its global presence and strengthens regional manufacturing capabilities.
Reinforcing Sanmina’s Role in Cloud and AI Markets
ZT Systems has built a reputation for delivering robust cloud and AI infrastructure tailored for hyperscalers. Its solutions span from components to fully integrated racks. These capabilities now integrate with Sanmina’s end-to-end design and supply chain services. This combination enhances operational scale and accelerates time-to-market for mission-critical deployments.
The acquisition significantly boosts Sanmina’s competitiveness. It offers deeper customer relationships and enables support across a broader technology spectrum for hyperscaler and OEM clients.
Financial Outlook and Strategic Partnership with AMD
Sanmina secured $2.5 billion in committed financing from Bank of America. Management expects the transaction to be accretive to non-GAAP earnings within the first year. Synergies from scale and vertical integration should improve margins further over time.
AMD will retain the AI systems design segment of ZT Systems. However, it will collaborate with Sanmina as a preferred manufacturing partner for next-generation AI rack systems. This agreement ensures that Sanmina becomes the go-to partner for deploying AMD’s AI platforms at scale.
Creating a Moat in AI Manufacturing
As AI hardware grows increasingly complex, manufacturers must offer specialised integration and cooling systems. ZT Systems’ proprietary capabilities offer immediate access to these technologies. Sanmina now leapfrogs traditional EMS providers that lack such niche expertise.
With AI deployments accelerating, the new AMD partnership creates a reliable pipeline of innovation. Sanmina becomes the preferred manufacturer for AMD’s AI solutions, solidifying its strategic role in this high-growth ecosystem.
Strategic Impact and Shareholder Value
This acquisition fundamentally shifts Sanmina’s market positioning. It combines revenue scale, technical depth, and strategic partnerships to capture long-term growth in the digital infrastructure economy.
The transaction received unanimous approval from Sanmina’s board. It is expected to close by late 2025, subject to regulatory clearance.
