Entegris, the Massachusetts-based supplier of electronic materials for semiconductor makers and other industries, is slated to receive $75 million from a federal program designed to boost the nation's chipmaking capacity — money that would support construction of the company's state-of-the-art, $600 million manufacturing facility being built in Colorado Springs.
The company and the U.S. Department of Commerce announced a preliminary agreement this week for Entegris to receive the funding via the Creating Helpful Incentives to Produce Semiconductors and Science program — known as the CHIPS and Science Act. Federal lawmakers and the Biden administration created the program in 2022 to provide financial incentives to expand the presence and construction of microprocessor manufacturing facilities in the United States, among other initiatives.
The Commerce Department in January also announced plans to award $90 million to Microchip Technology, which will help the Arizona-based company boost production at its Colorado Springs semiconductor plant.
In Entegris' case, its funding will be the first significant award given to a materials company that supplies products to chip manufacturers, Bill Shaner, president of Entegris' Advanced Materials Handling division, said Friday.
"This is the opportunity for the Department of Commerce to send a message of not only bringing the fab (semiconductor) manufacturers back to the U.S., but also the supply chain," he said.
Entegris, whose presence in Colorado Springs dates back more than three decades, broke ground in June 2023 on what it calls a "manufacturing center of excellence" on nearly 90 acres at 301 S. Rockrimmon Blvd. on Colorado Springs' northwest side. The site had been home to a manufacturing plant operated by California tech giant Hewlett-Packard and that was torn down more than a decade ago.
The first phase of Entegris' manufacturing center is the construction of a 130,000-square-foot building, which Shaner said has been expanded from its original 100,000 square feet because of increased demand for company products. Its price tag continues to be around $200 million and it will employ 100 to 200 people, he said.
This week, the building's last beam was put in place and the company expects to start moving equipment into the facility by year's end, Shaner said. Commercial manufacturing is slated to get underway at the building in mid-2025, he said.
Entegris' building will support production of Front-Opening-Unified Pods or FOUPs, which currently are produced entirely overseas and that are "an essential product" that transports and protects silicon wafers during the manufacturing of semiconductors, the company says. The building also will produce liquid filter membranes, according to Entegris.
A second phase of Entegris' manufacturing center in Colorado Springs calls for construction of another 400,000 to 500,000 square feet, where the company would produce advanced liquid filters and purifiers, among other work.
That second phase would increase the manufacturing center's overall price tag to $600 million, and the company would boost jobs at the site to about 600, Entegris has said. The company has said it plans to hire managers, technicians, chemists, engineers and warehouse operators, with average wages of nearly $75,000 a year.
The $75 million in CHIPS Act funding would support both project phases, Shaner said.
While market demand for products will help drive a decision on the manufacturing center's expansion, Shaner said, "we are planning phase two right now, and the (CHIPS) grant is one of the reasons why we're more optimistic about moving forward with phase two."
Entegris estimates it will finalize its agreement with the Commerce Department on the CHIPS Act award over the next six months to a year, Shaner said.
The money would come in the form of a grant and be distributed to the company over multiple years, he said. An initial payment likely would come in 2025.
To receive the award, Entegris must demonstrate physical milestones on the manufacturing facility, such as showing construction of the building, producing products and hiring employees, Shaner said.
Entegris also received financial incentives from the state, local governments and business groups totaling roughly $124 million.
"We're really humble and excited about this award," Shaner said of the CHIPS Act funding. "We made a big investment in our decision to build this campus in Colorado Springs. And we have over $100 million in the ground right now. ... And so we're really excited now to see the preliminary agreement with the CHIPS office. That's an area that really validates our decision to make the investment."
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