Intel & Brookfield to co-invest $30B in Arizona chip fabs
The US chipmaker has signed an agreement with Canada's Brookfield Asset Management to jointly fund up to USD 30 billion for Intel's chip fabs in Arizona.
Intel has just launched a new Semiconductor Co-Investment Program (SCIP) – which the company describes as a new funding model for the semiconductor industry. As part of its program, Intel has signed a definitive agreement with the infrastructure affiliate of Brookfield Asset Management, which will provide Intel with a new, expanded pool of capital for manufacturing build-outs.
Under the terms of the agreement, the companies will jointly invest up to USD 30 billion in Intel’s previously announced manufacturing expansion at its Ocotillo campus in Chandler, Arizona, with Intel funding 51% and Brookfield funding 49% of the total project cost.
Intel says in a press release that it will retain majority ownership and operating control of the two new chip factories in Chandler – which will support long-term demand for Intel’s products and provide capacity for Intel Foundry Services (IFS) customers. The transaction with Brookfield is expected to close by the end of 2022, subject to customary closing conditions.
“This landmark arrangement is an important step forward for Intel’s Smart Capital approach and builds on the momentum from the recent passage of the CHIPS Act in the U.S.,” says David Zinsner, Intel CFO, in the press release. “Semiconductor manufacturing is among the most capital-intensive industries in the world, and Intel’s bold IDM 2.0 strategy demands a unique funding approach. Our agreement with Brookfield is a first for our industry, and we expect it will allow us to increase flexibility while maintaining capacity on our balance sheet to create a more distributed and resilient supply chain.”