Two people who are familiar with the situation have stated that the incoming government of Mario Draghi and Intel Corporation (NASDAQ:INTC) have reached the conclusion that the town of Vigasio in the Veneto region of northeastern Italy will be the ideal location for a new chip factory in Italy that will be worth multiple billions of euros. This information was provided by these two individuals. It is planned that the factory will be situated in Italy.
The investment that Intel Corporation (NASDAQ:INTC) is making in Italy is a part of a larger plan that was revealed by the American chipmaker in March of last year to invest up to 80 billion euros ($77.5 billion) over the next decade in developing capacity across Europe. The investment that Intel Corporation is making in Italy is in the form of capital expenditure.
INTC’s New Chip Plant
Intel Corporation (NASDAQ:INTC) has stated that the Italian plant will create 1,500 jobs and 3,500 jobs across suppliers and partners, and operations are expected to begin between 2025 and 2027. The initial investment will be approximately 4.5 billion euros, with the expectation that it will increase over time.
The Italian factory would be a cutting-edge facility for the assembly and packaging of semiconductors; it would use cutting-edge technology to weave together complete chips out of smaller tiles.
The sources said that the parties had detailed a comprehensive agreement in early September but that no public announcement would be made before Sunday’s general election due to the matter’s sensitivity. The sources asked not to be identified because of the matter’s sensitivity.
Due to the fact that the negotiations are still in progress and must be kept confidential, a spokeswoman for Intel Corporation (NASDAQ:INTC) decided against making any comments. Even Draghi’s office made the decision not to answer the question when it was presented to them.
From a shortlist of two potential locations, one of which is located in the northern Piedmont region, Vigasio, which is close to Verona and on the strategically important Brenner road and railway, has emerged as the top choice.
According to one of the sources, one of the reasons that this location was chosen is that it has excellent connections with Germany and, more specifically, with the city of Magdeburg, where Intel Corporation (NASDAQ:INTC) plans to construct two factories.
Initially, Intel Corporation (NASDAQ:INTC) and the government had also explored locations in Lombardy, Apulia, and Sicily as potential candidates.
The persons claimed that Draghi’s closest aides intended to embark on behind-the-scenes negotiations with their future successors to prevent any chance that Italy’s new government would dispute the arrangement. They said that the choice of location for the site is extremely politically sensitive.
All of the public opinion polls agree that the nationalist Brothers of Italy group, led by Giorgia Meloni, will come out on Sunday and share power with its partners, the League, which Matteo Salvini leads, and Silvio Berlusconi’s Forza Italia.
The sources refused to disclose any further information, but Reuters has reported in the past that Rome is willing to support up to 40 percent of Intel’s entire investment in Italy.
According to one of the sources, before any arrangement is eventually formalized, the state contribution to Intel’s investment program is something that must necessarily be communicated to the next administration. Draghi may let the next government make the announcement, the source added.
In addition, discussions are taking place between Rome and the French-Italian company STMicroelectronics, as well as the chipmakers MEMC Electronic Materials Inc. and TSMC (2330.TW) from Taiwan, as well as the Israeli company Tower Semiconductor (TSEM.TA), which Intel Corporation purchased earlier on in the year.
Featured Image: Megapixl © Dragan56