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A Singapore-based semiconductor start-up is to plough €3.2bn into setting up a chipmaking plant in Italy, creating hundreds of jobs, as part of the EU country’s drive to attract investment in high-tech industries.
Silicon Box, valued recently at $1bn, plans to produce chips for artificial intelligence, electric vehicles and high-performance computing in a greenfield facility in northern Italy.
The plant is expected to employ 1,600 people once it is fully operational and will generate thousands of indirect jobs in supply and logistics, the Italian government and company officials said on Monday.
The move comes as the EU has set an ambitious target of doubling its semiconductor production capacity by 2030 to 20 per cent of the global total, from 10 per cent in 2021, in a push to reduce dependence on China for strategic supplies as part of an overall “de-risking strategy”.
Adolfo Urso, industry minister, said Rome has sent a task force around the world in recent months with the aim of attracting high-tech investment to Italy, a country better known for its exports of luxury goods, food and wine.
“Recent global upheavals highlight the need to build a more resilient supply chain for semiconductors in Europe,” Urso said on Monday, adding that chips are “at the centre of [the Italian government’s] strategic priorities”.
He hoped that the Silicon Box investment would “act as a catalyst for further investments and innovations in Italy”.
Rome will provide financial support through grants to Silicon Box, Italian officials said. They declined to specify the amount, which must be approved by the EU before it can go ahead.
The facility will focus on producing “chiplets”, a way of manufacturing semiconductors that aims to improve processors’ performance by packaging together several tiny components, rather than the traditional approach of stamping everything on to a single piece of silicon.
Proponents such as Intel say chiplets can offer designers more flexibility, for instance by combining cutting-edge components with older, cheaper ones. But they can also be more expensive and complex to produce.
News of the investment comes months after Prime Minister Giorgia Meloni’s government formally withdrew from President Xi Jinping’s flagship Belt & Road Agreement, a move that many in Italy feared would lead to retaliation by Beijing against Italian business interests.
Italy had hoped to woo Intel to set up an advanced packaging and chip assembly plant, as part of the US company’s plans to scale up capacity across Europe. The project, though announced, was never finalised.
The German government meanwhile has promised state support to international chipmakers investing in Europe’s largest economy. Intel is spending €30bn on two factories there and is to receive €9.9bn in grants for its project, the largest foreign investment in the country’s postwar history.
Silicon Box was started in 2021 by the husband-and-wife duo that founded US-listed chipmaker Marvell, and the current chief executive Han Byung Joon.
Since then, it has raised capital from investors including India’s Tata Electronics, Taiwan’s United Microelectronics Corporation, and US-based contract chip equipment manufacturer Lam Research. It is now valued at $1bn after raising $200mn in a Series B round in January.
Italy has the infrastructure and human resources necessary to make the project a success, Han said on Monday, and referred to “the government’s initiative to support and streamline the business environment”.
He added: “Italy offers an exceptional ecosystem for higher education with strong traditions in engineering and sciences.”
The Silicon Box plant will be built in Italy’s industrialised north. The final site has yet to be decided, with work on the project expected to begin this year.
Additional reporting by Giuliana Ricozzi in Rome and Tim Bradshaw in London
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