Israel leans on Intel to dump the Irish

Mega-chipmaker Intel is being lobbied by the Israelis to get it to change its mind about setting up shop in Ireland.

Intel wants to build a $4.8 billion 15-nanometer process in the Emerald Isle, partly because of the range of sweeteners that the cash strapped Irish government came up with, and partly because 15 nanometers is so small that it requires leprechauns to build.

Until it made the announcement, Intel had been collecting shedloads of cash to improve its Fab 28 in Kiryat Gat.

Six months ago, Intel asked nicely for a $600 million grant from the Ministry of Industry’s Investment Promotion Centre in order to upgrade Fab 28 again. The ministry offered a smaller grant on the condition that Chipzilla builds a new fab in Beit She’an in the north.

Intel was furious and opened negations with the Irish.

Now, according to the Israeli newspaper Globes, Israel’s Ministry of Finance and Ministry of Industry, Trade and Labour has been saying it was surprised that Intel did not haggle.

Clearly Chipzilla should have said $200 million for that, you must be joking! And me, with an elderly grandmother to support.

It should have gone to $500 million next, and the Israelis would have thrown in a nice gourd which was worth at least $10.

Israel has redoubled its efforts to persuade Intel to make its next big investment in the country.

A government official, in the talks with Intel, told Globes that it had the impression Chipzilla was leaning heavily toward Ireland. But, he added, the company was still very interested in building an assembly plant in Beit She’an.

Intel will make its final decision on the location of the next fab in two months and an Israeli government source said that it had not missed the train yet.

One of the things Israel is pointing out to Intel is that while Ireland has tax breaks it does not have the infrastructure which already exists in Kiryat Gat. 

Israeli deepthroats claim that there is a split in Intel between the Israeli office, which wants the new technology in the promised land, and the US which fancies the Emerald Isle.

But Intel’s headquarters in the US is under the influence of a cabal of officeholders who previously worked in Ireland. We guess the beer is better.

The Ministry of Finance and Ministry of Industry is also a problem. While it might want Chipzilla to stay this side of Jordan, it is not prepared to provide more sweeteners, and Intel wants things very sweet.

Intel has told hacks asking questions about the next Fab that it has not made up its mind yet.