A report has suggested that the IDA's decision to withdraw €170m in grant aid for Intel could have more severe consequences than originally thought.
The Irish Times has reported that Intel Ireland has sought planning permission to build as many as three new factories in Leixlip, Co Kildare, where it already employs some 4,700 people at a massive microchip manufacturing complex. However, the recent decision by the IDA to withdraw some €170m in grant aid for Intel could influence the company's stance on the construction of two of the three new facilities.
On Wednesday, the IDA, the government development agency, said that it would hold back the cash after receiving signals from Brussels that the grant aid package for a new wafer fabrication facility called Fab 24-2 may not be allowed under EU rules. Though Intel said that it will still build the factory, it warned that it would now reconsider other potential investments in Ireland.
On Friday, it emerged in an Irish Times report that these other investments may consist of two more wafer fabrication plants in Leixlip, for which planning permission has already been sought. In total the two additional plans would have cost some €2.8bn to build, and are likely to have employed hundreds of people.
Interestingly, these plants were not declared publicly when the IDA and Intel jointly announced the Fab 24-2 investment in May 2004. But according to the Irish Times, one of the two new facilities was in fact covered by €170m in proposed grant aid from the IDA. While Intel said that it will still go ahead with Fab24-2, it is understood that the second and third plants many not get the green light, thanks in part to the EU's decision to block the IDA's proposed funding for Intel.