Italy woos Intel over chip plant

Rome is drawing up an offer to try to convince Intel to invest billions of euros in an advanced chipmaking plant in Italy, as Germany emerges as frontrunner to land an even bigger megafactory planned by the US company, three sources said.

The plants would be part of a drive by the US group to build cutting-edge manufacturing capacity in Europe to help avoid future supply shortages of the kind currently crippling the automotive industry in particular. Rome is already in talks with Intel about the potential investment, which according to preliminary estimates would be worth more than 4 billion euro ($4.7 billion), the sources who are involved in the discussions said.

One of them said the total could even reach around 8 billion euros, depending on Intel's plans.

They declined to be identified because the details are confidential.

Rome is ready to fund part of the overall investment with public money and offer favourable terms to Intel, including on labour and energy costs, the sources said. The factory would create more than 1,000 direct jobs in Italy, they added.

"The government is preparing a very detailed offer with the aim of clinching a deal by the end of the year," one of the sources told Reuters.