Confirmed.
2.6.26-3.9 doesn't solve the problem, which is apparently related to the hardy
kernel KVM.
** Changed in: linux (Ubuntu)
Importance: Undecided => Medium
Status: New => Confirmed
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intrepid kernel 2.6.26-2-generic (amd64) won't boot as kvm guest
https://bugs.launchpad.net/bugs/243677
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