Intel Foundry Services (IFS) and Tower Semiconductor have reached an agreement for Intel to provide foundry services and 300mm manufacturing capacity to Tower.

As per the agreement, Tower, which is focused on analog integrated circuits, will gain access to Intel’s New Mexico-based chip fabrication facility.

The deal will see Tower invest up to $300m to purchase and own equipment and other fixed assets, which will be installed in the New Mexico plant.

With the agreement, Tower hopes to expand its monthly capacity by more than 600,000 photo layers to meet anticipated client demand for 300mm advanced analogue processing.

Intel announced a $3.5bn investment in May 2021 to expand operations in New Mexico and upgrade its campus in Rio Rancho to produce advanced semiconductor packaging.

Intel senior vice president and Intel Foundry Services general manager Stuart Pann said: “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.”

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By GlobalData

Tower CEO Russell Ellwanger said: “This collaboration with Intel allows us to fulfill our customers’ demand roadmaps, with a particular focus on advanced power management and radio frequency silicon on insulator (RF SOI) solutions, with full process flow qualification planned in 2024. We see this as a first step towards multiple unique synergistic solutions with Intel.”

The agreement comes just few weeks after Intel agreed to terminate the $5.4bn deal to buy Israel-based Tower.

In April this year, IFS signed a deal to enable chip designer Arm to build low-power compute system-on-chips (SoCs) using the Intel 18A process.