SURGE IN PC SALES PROMPTS INTEL TO BUILD IN ISRAEL, IRELAND, MALAYSIA

SURGE IN PC SALES PROMPTS INTEL TO BUILD IN ISRAEL, IRELAND, MALAYSIA

Intel Corp., the world's largest maker of computer chips, said Friday it will build new plants in Israel, Ireland and Malaysia at a cost of more than $3.1 billion to meet an expected surge in demand.

''Industry experts are predicting that personal computer sales will reach 100 million units per year before the end of the decade," said Dr. Craig Barrett, Intel's executive vice president and chief operating officer.The $1.6 billion semiconductor plant in Israel and $1.5 billion facility in Ireland will be the largest foreign investments in either state.

Intel said production of memory chips for computers at the Israeli facility would begin in 1998, with $1 billion in annual output, all designated for export. The plant will directly employ 1,500 people.

Under Israel's law for the encouragement of capital investment in developing areas, Intel will receive a 38 percent grant from the Industry and Trade Ministry's Investment Center.

However, since the large sum would severely strain the center's budget, the two sides have agreed the government will spread out the payment over 10 years.

The government will treat the outstanding amount as a loan from Intel and pay the U.S. company interest.

Intel plans to build the facility in the developing area of Kiryat Gat, in the Negev desert. It already has a production plant in Jerusalem as well as a research and development facility in Haifa.

Intel's plant in Ireland represents the single biggest foreign investment since the Republic's foundation seven decades ago and underlines Ireland's claim to be the "silicon valley" of Europe, based on the number of foreign computer companies in the country.

The 750,000 square-foot plant, called Fab 14, will build advanced logic products, such as future microprocessors beyond the Pentium Pro processor. It is scheduled for completion in 1998.

In Malaysia, Intel's factory will produce motherboards and networking/ communications boards for computer manufacturers. The 250,000-square-foot factory, to be built at the Kulim Hi-Tech Park, is scheduled for completion in 1996. Its cost was not disclosed.