The US chip giant will get a $600 million Israeli government
grant, 15% of the investment, subject to a study by the
Investment Promotion Center. Intel (Nasdaq:INTC) will build a second fab in Kiryat Gat for $4 billion,
Intel CEO Dr. Craig Barrett told Prime Minister Ariel Sharon today. The
fab will create 2,000 jobs directly, and 2,000 indirectly. Sharon said Intel’s decision follows intensive negotiations between the
company and a team headed by Minister of Industry, Trade and Labor Ehud Olmert,
which included officials from the Prime Minister’s Office and Ministries of Finance
and Industry. “The decision is a vote of complete confidence in Israel’s economic
policies, and in its stability and strength,” said Sharon. Intel will get a $600 million government grant, 15% of the investment, subject to a
study by the Investment Promotion Center. Intel will request the grant within a week,
promising to build the fab within five years of obtaining approval. The government originally planned to give Intel a grant for 12.5% of the investment
, while Intel was asking for 20% as a condition for building the fab. A compromise
was reached in negotiations with Intel Israel and Intel VP finance and enterprise
services and director, tax, licensing and customs Nanci S. Palmintere. (globes | 