SkyWater Technology (SKYT) announced that it has signed a preliminary memorandum of terms, or PMT, valued at up to $16M with the CHIPS for America program, which is administered by the U.S. Department of Commerce. This proposed funding would provide federal incentives to enhance production capabilities at SkyWater’s Minnesota facility. This funding through the CHIPS Act will accelerate modernization and equipment upgrades to enhance production for customers in the aerospace and defense as well as biomedical, industrial, thermal imaging and quantum computing markets. The proposed $16M CHIPS Program award will be combined with $19M in incentives from the State of Minnesota’s Forward Fund. The newly announced state and federal incentives will complement SkyWater’s existing and planned customer-funded CapEx co-investments totaling $320 million through 2026, bringing the expected combined outside investment levels now to over $350M during this decade. SkyWater will also utilize the Advanced Manufacturing Investment Tax Credit which is expected to be up to 25% of qualified capital expenditures. Through the proposed CHIPS funding, SkyWater expects to: increase its U.S.-based 200 mm semiconductor technology development and production capacity by 30%; create approximately 70 new jobs to support the workforce in Bloomington, Minnesota; modernize its facility to meet the escalating demand for domestically produced microelectronics; ensure a consistent supply of silicon for DOD and commercial programs, and accelerate technology development and time to market for customers.
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