Intel’s (Nasdaq: INTC) foundry business segment will produce 65-nanometer power management BCD technology for Tower Semiconductor (Nasdaq: TSEM) and allow the latter to use its manufacturing facility in Rio Rancho, New Mexico, under an agreement.
The agreement will provide Tower with more than 600,000 photo layers of capacity corridor per month to help the company meet the demand of customers worldwide for 300mm analog processing chips, Intel said Monday.
Tower will make an investment of up to $300 million to buy equipment and install fixed assets at Intel’s Fab 11X in Rio Rancho.
“We launched Intel Foundry Services with a long-term view of delivering the world’s first open system foundry that brings together a secure, sustainable, and resilient supply chain with the best of Intel and our ecosystem. We’re thrilled that Tower sees the unique value we provide and chose us to open their 300mm U.S. capacity corridor,” said Stuart Pann, senior vice president at Intel and general manager of IFS.
Tower CEO Russell Ellwanger said the collaboration with Intel will enable the company to meet clients’ demand roadmaps with a focus on advanced power management and radio frequency silicon on insulator platforms and achieve full process flow qualification in 2024.
The agreement came weeks after Intel decided to drop a $5.4 billion deal to buy Tower after failing to receive the required regulatory approvals in a timely manner.