SAN FRANCISCO: Intel Corporation on Monday announced that it will pump billions of dollars into ASML Holding during the next five years to speed up advances in tools for making computer chips.

Intel said it would spend approximately $4.1 billion investing in research at and buying an equity stake in the Dutch firm to speed development of technology for chips made on 450-millimeter diameter wafers.

“The objective is to shorten the schedule for deploying the lithography equipment supporting these technologies by as much as two years, resulting in significant cost savings and other productivity improvements for semiconductor manufacturers,” Intel said in a release.

The first phase of the scheme will consist of Intel committing about $680 million to ASML for research and development of 450-mm chip manufacturing equipment and buying a 10 per cent stake in the firm for about $2.1 billion.

Approval of ASML stockholders is needed for the second part of the plan, in which Intel would provide an additional $340 million to ASML for research and acquire another five per cent of the company for about $1 billion.

“The transition from one wafer size to the next has historically delivered a 30 to 40 per cent reduction in die cost and we expect the shift from today's standard 300-mm wafers to larger 450-mm wafers to offer similar benefits,” said Intel chief operating officer Brian Krzanich.

“The faster we do this, the sooner we can gain the benefit of productivity improvements.”

ASML said that it intended to sell up to a 25 per cent aggregate stake in the company to Intel and other semiconductor manufacturers as part of the innovative program to fund research.

California-based Intel's stake in ASML was not to exceed 15 per cent of ASML, according to the companies.

“We are extremely encouraged that Intel has made these investments, which will benefit every semiconductor manufacturer in the industry,” ASML chief executive Eric Meurice said in a release.

“We hope to be able to announce additional investments by our other customers in the coming weeks.”