The Santa Clara-based Transmeta, former supplier of low-power Intel-compatible processors, announced on Wednesday that it started looking for a buyer. The company also announced two agreements with Intel. The  company is a well known supplier of chip patents. It revealed that over the past few months, it had been exploring a range of “strategic alternatives”. It seems that, after strengthening its balance sheet, it decided that a sale would be the best way to “enhance value for all its stockholders”. The financial advisor the company is currently working with is Piper Jaffray & Co.

The agreements with Intel that Transmeta also announced on Wednesday are related to licensing of Transmeta technologies and intellectual property. The first of the agreements is a nonexclusive technology licensing one, fully paid-up, according to which the comapny will deliver “proprietary Transmeta computing technologies” to the giant chip manufacturer and Intel is also granted a nonexclusive license to use that technology.

The second agreement revealed is actually an amendment to a previous settlement the two companies inked on December 31, 2007. Based on it, Intel was granted a perpetual nonexclusive license to all Transmeta patents and patent applications, which also included any patent right Transmeta would acquire before December 31, 2017.

According to the agreement, Intel was to pay Transmeta $20 million per year in five annual payments for each year from 2009 through 2013. As Transmeta said, “This amendment accelerates Intel's remaining future payment obligations under the settlement agreement”. The company also said that, as a result of this amendment, Intel is expected to pay a total of $91.5 million in cash before the end of Transmeta's current fiscal quarter, which is September 30.

The company received an offer from Riley Investment Management back in February, but ultimately rejected it. Riley sustained at that time that Transmeta did not have a convincing business strategy based on its LongRun2 technology. The company described the LongRun2 as a suite of technologies designed for advanced power management and “leakage control”. According to Riley, at that time, there was no “credible evidence” that the LongRun2-related operating expenses would produce anything beneficial for the shareholders.