Intel steps in to hire 800 Micron workers after Israel plant tagged for closure

Intel steps in to hire 800 Micron workers after Israel plant tagged for closure

Summary: The largest employer in Israel's high-tech economy is about to get even bigger, as it takes over Micron's Israeli fab – likely to be the future site of Intel's 10nm chip manufacturing plant.

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Israel's President Shimon Peres on a visit earlier this year to Intel's Kiryat Gat fab. Image courtesy Sivan Faraj

Intel confirmed on Monday that it would hire some 800 full-time employees and 200 contract workers from the Israeli branch of chip giant Micron, after the Boise-based company announced last year that it would shut down operations at its Kiryat Gat plant.

Under the deal, Intel will also take over the plant — which Intel itself built 15 years ago, before constructing its more up-to-date Fab 28 plant right next door in 2006.

The Micron fab was set to close only in 2015 unless a buyer could be found, company officials said earlier this year. The closure of the plant was announced last December.

Intel still owns the plant, having leased it to Micron after Fab 28 was built. Under this week's agreement, Intel will take full possession of the facility.

For the time being, Intel will manufacture NOR flash memories for Micron following the closing of the transaction, but according to media reports, the company will refurbish the plant to make it capable of manufacturing 10-nanometer chips.

Speaking at an Intel event earlier this year, Intel corporate VP Mooly Eden said that one of Intel's objectives is to gear up the Kiryat Gat fab to eventually produce 10nm 3D chips.

Fab 28 is Intel's largest producer of the 22nm chips which are powering the third generation of Ultrabooks. Intel invested $1bn in its Israel operation in 2012, much of it to upgrade the Kiryat Gat plant to produce the 22nm chips, Eden said.

The deal was long expected: a report in June said that Intel had proposed taking over the Micron plant and retaining the workers — if the government agreed to provide Intel with assistance for upgrading the plant. Intel is said to be seeking a grant of between $300m and $400m, amounting to 10 percent of the cost of construction.

Besides the full-time workers, Intel will also retain some 200 contractors currently employed by Micron. The deal is subject to government approval, but the Micron closure has been a major concern for Israeli politicians – considering the country's reputation as a tech centre — so approval is not expected to be an issue. The transaction is expected to close in the fourth quarter of this year.

The new Intel hires will grow the company's Israeli workforce to an all-time high. Intel Israel already employs nearly 8,000 workers directly, and is indirectly responsible, through suppliers and subsidiaries, for the employment of some 25,000 people. Directly and indirectly, the company employs 10 percent of all workers in the electronics and software industry in Israel.

Maxine Fassberg, VP of Intel's technology and manufacturing group, Fab 28 plant manager, and Intel Israel general manager, said the deal "once again exhibits Intel Corporation's longtime commitment to Intel Israel and to the State of Israel".

"Returning the Micron facility to Intel's possession is an important business move on Intel's part," she said. "Micron Israel has talented people who will contribute to Intel's continuous growth and development."

Further reading

Topics: Intel, Processors, IT Employment

David Shamah

About David Shamah

David Shamah has been writing about Israeli technology news for over a decade, both in print and on the web, and knows the Israeli tech scene and its start-ups inside out.

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7 comments
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  • why israel?

    why a such a big companies like IBM,HP,Intel choose Israel for technology invesment ? actually israel settled in very risky and critical area, all invesments could be blow in one sec. if i were, i would choose less risky places for factory or lab, like finland,norway, mongolia etc. invesment in israel not a clever think.
    Sourceof Prana
    • why not US?

      Intel makes most $$$ here, isn't it.
      LlNUX Geek
      • The do

        They are already building developing plants In the US including DX1 and now DX2 in Oregon
        Scatcatpdx
        • But...

          Those are plants to make - not R&D.
          Gisabun
    • Errr.....

      I guess you know diddly squat about Israel.
      The economy in Israel is still outpacing probably most of not all other countries.
      They have some of the most well known technical universities in the world with a higher number of awarded students that even some of the bigger universities and elsewhere.
      You think buildings are being bombed in Israel daily or something?
      You go where the people can do the job. Israel handles R&D - not as much manufacturing. R&D requires engineers, project managers and others - probably very few in Mongolia [!!!!].
      You can also add Google [and Motorola], Microsoft, Adobe, .... to the list of companies.
      Gisabun
      • not a reason

        Hello Gisabun,

        all the things you said is not a reason for invesment in a country. any europe or american university can beat israel ones in numbers and quality. USA has much more engineers,england,finland or anywhere, only the thing would be cheap engineering and like that. if not cheap,again why the hell all these companies invest here? USA companies should return home to use their fortune and quality. besided all the R&D and support quality of israel companies are really bad.



        B.R.
        Sourceof Prana
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