The Adani Group, led by Gautam Adani, has reportedly put its $10 billion chip project with Israel’s Tower Semiconductor on hold.
According to a Reuters report, people familiar with the situation said the decision came after an internal review. The review found that the project is not a good fit, either strategically or financially.
In September last year, the Maharashtra government approved Adani Group’s plan to build a ₹83,947 crore ($10 billion) chip-making factory with Israel’s Tower Semiconductor. The project was part of India’s goal to become a global leader in chip manufacturing and was expected to create 5,000 jobs.
In the first phase, the chip factory will be able to produce 40,000 wafers each month. In the second phase, this will double to 80,000 wafers per month.
At first, the Adani Group said it was still thinking about the project. However, after a recent review, the company decided to step back, mainly because of concerns about low demand, especially in India.
It was more of a strategic choice. Adani looked into it and decided to wait,” a source said. There’s also a chance the project could start again in the future.
Another source said the Adani Group was unhappy with how much money Tower was ready to invest in the partnership but didn’t share more details.
Tower was supposed to bring technical knowledge to the project, but according to the report, Adani wanted Tower to invest more money and be more financially involved.
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