The investment is likely to be used for the ramping of 10nm FinFET manufacturing at Fab 28.
"I have now received a happy message from Intel CEO [for Israel] Yaniv Gerti, who informed me that after two years of intensive work, the management of the global company accepted our proposal to invest another NIS 18 billion in expanding the company's activity in Israel," said Minister of Finance Moshe Kahlon in the statement. "There was competition with several countries for Intel's investment, and for the past two years I worked on bringing the investment to Israel with the vice president of Intel International until the happy announcement today," he concluded.
Intel is expected to receive a package of substantial benefits in return for the investment. These are set to include a grant of 20 to 30 percent of the investment under the Law for the Encouragement of Capital Investment, a subsidy on development costs and reduced corporation tax.
One of those rival countries is likely to have been Ireland although Intel has historically invested in each site on alternate nodes so that Intel's Leixlip site received some investment to get to 14nm FinFET.
Intel is expected to invest the $5 billion over the period 2018 to 2020 and create 250 additional jobs at Kiryat Gat while purchasing up NIS3 billion or nearly $1 billion in goods and services locally.
Intel is a big investor in Israel through Intel Capital, its venture capital arm, and the recent acquisition of Mobileye Ltd., which has become its autonomous driving division.
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