Exclusive: Italy and Intel choose Veneto as the preferred region for new chip factory

The Intel Corporation logo is seen in a temporary office during the World Economic Forum 2022 (WEF) in the Alpine resort of Davos, Switzerland, May 25, 2022. REUTERS/Arnd Wiegmann/File Photo

ROME, Sept. 25 (Reuters) – The outgoing government of Mario Draghi and Intel (INTC.O) has chosen the city of Vigasio in the northeastern region of Veneto as their preferred location for a new multi-billion-euro chip factory in Italy, two people who familiar with the matter said.

Intel’s investment in Italy is part of a broader plan announced last March by the US chipmaker to invest a staggering 80 billion euros ($77.5 billion) over the next decade in capacity building across Europe. read more

With an initial investment of around €4.5 billion expected to increase over time, Intel has said the Italian factory would create 1,500 jobs plus an additional 3,500 jobs at suppliers and partners, with operations to close between 2025 and start in 2027.

The Italian plant would become an advanced semiconductor packaging and assembly plant, using new technologies to weave entire chips from tiles.

The sources asked not to be named due to the sensitivity of the matter and said the parties had worked out a comprehensive agreement in early September, but no public announcement would be made before Sunday’s general election results.

An Intel spokesperson did not comment as negotiations are ongoing and confidential. Draghi’s office also declined to comment.

Located near Verona, on the strategic Brenner highway and railway, Vigasio is the preferred option of a shortlist of two locations, including one in the northwestern region of Piedmont.

Among other things, the site is well connected to Germany and in particular to the city of Magdeburg, where Intel will build two factories, one of the sources said.

Intel and the government had also initially considered locations in the regions of Lombardy, Apulia, and Sicily.

Draghi’s closest associates are aiming to enter into behind-the-scenes negotiations with their likely successors to avoid any risk of the deal being challenged by Italy’s new government, the people said, adding that the choice of site is a highly politically sensitive matter. .

Polls have all predicted that Giorgia Meloni’s nationalist Brothers of Italy group will become the leading party on Sunday, sharing power with its allies the League, led by Matteo Salvini, and Silvio Berlusconi’s Forza Italia.

The sources declined to provide further details, but Reuters has previously reported that Rome is willing to fund as much as 40% of Intel’s total investment in Italy.

The state contribution to Intel’s investment program is something that must necessarily be shared with the next government before a deal is finally formalized, one of the sources said, adding that Draghi could have the next government make the announcement.

To boost domestic chip production, Rome is also in talks with Franco-Italian STMicroelectronics, Taiwanese chipmakers MEMC Electronic Materials Inc and TSMC (2330.TW), and Israel’s Tower Semiconductor (TSEM.TA), which Intel bought earlier this year. .

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Additional reporting by Valentina Za and Elvira Pollina; Edited by David Evans

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