Intel signs deal with Brookfield for chip investment

Intel, one of the world's largest microchip manufacturers, has reached an agreement with Canadian-based asset manager Brookfield Asset Management for an investment of up to $30 billion in chip factories in Arizona. Intel announced the first of its kind, the Semiconductor Co-Investment Program (SCIP), in a statement today. It was reported that the program in question brings a new financing model to the capital-intensive semiconductor industry. It was stated that Intel signed an agreement with the infrastructure subsidiary of Brookfield Asset Management, one of the world's largest asset managers, as part of the program, and that this will provide Intel with a new capital pool to expand its production. It was recalled in the statement that the agreement follows the memorandum of understanding signed by the two companies in February. It was stated that Intel will jointly invest up to $30 billion in the previously announced production expansion at its Ocotillo campus in Arizona as part of the agreement, and that Intel will finance 51 percent of the total project cost and Brookfield will finance 49 percent. It was reported in the statement that Intel will retain majority ownership and operational control of the two new chip factories. Intel Chief Financial Officer (CFO) David Zinsner stated in his statement on the subject that the agreement builds on the momentum gained from the Creating Helping Incentives to Manufacture Semiconductors for America (CHIPS) and Science Act, which went into effect in the US at the beginning of the month. The CHIPS and Science Act was signed into law by US President Joe Biden on August 9. The law, which aims to increase domestic semiconductor production, aims to alleviate the chip shortage that has caused disruptions in production in many sectors, from automobiles to electronics. The law includes approximately $52 billion in support for semiconductor production, as well as a 25% tax cut for 4 years to encourage the establishment of semiconductor factories.