Transmeta Investment - Wise Move?

As reported last Friday, AMD invested $7.5M in Transmeta in exchange for preferred stocks. We all know that AMD isn't exactly swimming in a pool of money and although it may not be a substantial amount, I'm quite sure AMD won't find it difficult to find good use for it. So is the investment a good use of AMD's limited cash? If you try and read the reasons put forward by both companies, you won't find anything other than corporate double-speak.

Transmeta:
"We are very pleased that AMD has made a strategic investment in the future of Transmeta," said Les Crudele, President and Chief Executive Officer of Transmeta. "AMD has long been a leader in the development and delivery of energy-efficient, high-performance computing technologies, standards and initiatives. Transmeta has been proud to endorse and contribute to those industry-leading activities, and we look forward to continuing our collaboration with AMD on technology initiatives in the future."

AMD:
"Transmeta has been an innovative force in the industry for more than a decade," said Dirk Meyer, President and Chief Operating Officer of AMD. "Transmeta was a key ally in helping to bring our highly-successful AMD64 technology to market and has supported the widespread industry adoption of both AMD64 and AMD's HyperTransport technology. Our investment will support Transmeta's technology development work and AMD's efforts to leverage Transmeta's innovative energy-efficient technologies to the benefit of AMD's customers."

Again, it's mostly back patting and pretending to say something when it fact both are struggling for exactly the opposite reasons. If I were to guess what this move is about, I would bet that it is noting but securing some of Transmeta's intellectual property. Nobody buys preferred stocks on a dying company except when they wish to secure a particular asset when the company files chapter11. Transmeta is fabless company and it doesn't require too much deductive reasoning skills to understand what AMD really wants. It could be a good move but to a lesser extent as the ATI purchase and I meant that in terms of both the good and the bad aspects of the merger.