ROME, Oct. 5 (Xinhua) -- Electronic semiconductor maker STMicroelectronics plans to invest 730 million euros (721 million U.S. dollars) in a new chip production facility in Catania on the southern Italian island of Sicily.
The investment, part of a broader scheme to increase microchip production in Europe, will in part be underwritten by a grant of 293 million euros from Italy's National Recovery and Resilience Plan (NRRP), the European Union (EU) package of grants and loans helping Italy's recovery from the coronavirus pandemic.
The allocation of the NRRP funding was approved on Wednesday by the European Commission, just before STMicroelectronics' announcement.
According to the company, the new plant will produce silicon carbide semiconductor chips to satisfy the growing demand for such chips in the production of vehicles and appliances.
It will be built adjacent to an existing silicon carbide semiconductor facility, helping create a kind of high-tech corridor in northeastern Sicily.
Once operational, the plant is expected to employ 700 workers.
In a statement, Jean Marc Shery, chief executive officer of the Italian-French tech giant, said the plant would be a key part of the EU's efforts to manufacture more and better microchips in its member states.
It is also expected to enable the company to increase its annual revenues beyond 20 billion U.S. dollars.
Shares in STMicroelectronics rose 1.5 percent in trading on Wednesday on the Italian Stock Exchange in Milan. (1 euro = 0.99 U.S. dollar)