Benzinga | Oct 22, 2021 10:56AM EDT

Rome Coaxes Intel Into 4B - 8B Chip Plant Investment: Reuters

* Rome is cajoling Intel Corp (NASDAQ:INTC) to invest billions of euros in an advanced chipmaking plant in Italy, Reuters reports.

* The Italian factory would be an "advanced packaging" plant that uses new technologies to manufacture whole chips out of tiles produced by Intel and other chipmakers.

* Rome is already in talks with Intel about the potential investment, rumored at over (euro)4 billion ($4.7 billion), reaching up to (euro)8 billion, the report adds.

* The factory would create over 1,000 direct jobs in Italy.

* Interestingly, Germany emerged as the frontrunner to land an even bigger mega factory planned by Intel to counter the global chip crisis that has especially endangered the auto sector.

* France is also a contender for the mega factory, while Italy faces competition from Poland, where Intel also has a presence for the packaging facility.

* Rome is ready to partly fund the overall investment with public money and offer favorable terms to Intel, including labor and energy costs.

* The potential sites include Turin's Mirafiori area, the Italian home of carmaker Stellantis NV (NYSE:STLA), and Catania in Sicily, where French-Italian chipmaker STMicroelectronics NV (NYSE:STM) already operates.

* Intel CEO Pat Gelsinger aims to announce the locations of two major new EU chip fabrication plants by year-end as it looks to spend (euro)80 billion over the next decade on the continent.

* Intel plans to reserve capacity at its chip factory in Ireland for automakers and help them shift to using its technology.

* Italian Prime Minister Mario Draghi emphasized initiatives to increase output to meet its target of producing 20% of the world's semiconductor output by 2030.

* Italy could also obtain a research center as another part of the overall investment Intel is preparing for Europe.

* Also Read: Why Intel Shares Crashed After-Hours Today

* Price Action: INTC shares traded lower by 10.6% at $50.09 on the last check Friday.