Intel said it has agreed to purchase a wafer fab with more than 900,000 in
manufacturing floor space from Rockwell International in Colorado Springs,
Colorado. Intel said it plans to invest $1.5 billion to retool the facility and
bring it on line quickly (before the end of this year) in order to help the
company boost short-term manufacturing shortages, especially in the area of
flash memories.
The facility, consisting of two wafer fabs, has been sitting idle for some
time. The oldest of the facilities, built in 1982 will be used as a test
facility. The second, measuring 670,000 squire feet, was completed in 1996 but
was never brought on line as the chip industry was in the midst of a major slump
at the time. Intel will retool the facility and put in a 0.18 micron production
line to and make advanced flash memories and logic ICs for communications and
computer systems. Up to 2,000 people will be employed at the facility.
"This facility will give us the ability to rapidly add more
manufacturing capacity in order to address our customers' growing demand for a
wide variety of our products," said Mike Splinter of Intel's Technology and
Manufacturing Group. Rockwell purchased the Colorado Springs plant from United
Technologies Microelectronics Center in 1995.
Meanwhile, Intel announced it has signed a contract to supply $1.5 billion
worth of flash memory ICs over the next three years to Sweden's Telefon AB LM
Ericsson, the world's Number 3 cellular phone maker. For Ericsson, the agreement
the company will have a steady supply of chips and will enable the company to
steer clear of any flash memory shortages that may develop.