Intel to sell Jerusalem fab, build China plant, reports say

By Colleen Taylor -- Electronic News, 1/16/2007

Santa Clara, Calif.-based chipmaker Intel Corp. is reportedly set to make a series of globe-spanning investment moves.

According to Reuters reports, Intel has plans to close its existing chip plant in Jerusalem, erect a new Jerusalem fab, sell its flash-memory activities at a plant in southern Israel, and invest in a new fab in China.

According to the report, Intel could stand to gain around $1.5 billion if the Israeli flash-memory activities are sold in full. According to a report by Israel-based financial news website TheMarker.com cited by Reuters, the financial news website of the Haaretz newspaper, the flash memory activities would be sold to STMicroelectronics. Intel's Jerusalem plant produces chips for the automobile industry.

Meanwhile, Intel reportedly is set to mobilize plans to invest in a major new plant in China to make leading-edge chips. The plant, which will make 65nm multi-core processors, is rumored to cost over $2 billion—Intel's biggest investment in China to date, according to the Reuters report that cited "two sources with knowledge of the plan." According to market research firm iSuppli Corp., Intel is already currently the country's largest semiconductor supplier. Further details as to the fab's location and timing of the construction were not disclosed.

Reps at Intel could not be reached for immediate comment on any of the reports.