U.S. subsidies to Micron: $6 billion

Micron Technology Inc., the largest U.S. maker of computer memory chips, is poised to receive more than $6 billion in grants from the Commerce Department to help pay for domestic factory projects as part of an effort to bring semiconductor production back to U.S. soil.

The award has not yet been finalized and could be announced as soon as next week, according to people familiar with the matter. It's unclear whether the company plans to accept loans made available through the 2022 Chips and Science Act in addition to direct grant funding.

Micron Technology, based in Boise, Idaho, is building factories in New York and its hometown. After the preliminary agreement is announced, the company will conduct months of due diligence before receiving funding in tranches based on project-specific benchmarks.

Representatives for Micron Technology, the Commerce Department and the White House declined to comment.

The CHIP Act allocates $39 billion in direct grants and $75 billion worth of loans and loan guarantees to revitalize U.S. chip manufacturing after decades of shifting production to Asia. Officials have announced six preliminary awards so far: three to companies making older-generation semiconductors, plus multibillion-dollar awards to Intel Corp, Taiwan Semiconductor Manufacturing Co. and South Korea's Samsung Electronics Co.

Commerce Secretary Gina Raimondo said the agency plans to use about $28 billion of the allocation for cutting-edge projects.

Micron Technology has committed to building up to four factories in New York state and one in Idaho. But CEO Sanjay Mehrotra said last month that the plans "require Micron to obtain sufficient chip subsidies, investment tax credits and local incentives to account for cost differences compared with overseas expansion." The company also has projects underway in China, India and Japan.

Raimondo said her agency will prioritize funding projects that begin production by the end of the decade. Two of Micron's four New York fabs are on track to meet that benchmark, while the other two won't be operational until 2041, the company said in a recent federal filing. People familiar with the matter said earlier that this means Micron Technology's contract may only support the first two factories in New York.

Computer memory and storage chips are essential components in everything from smartphones to the largest data centers, where they store information and help advanced logic process it. Production takes place mainly in Asia. Micron's two biggest competitors, Samsung and SK Hynix, account for most of the manufacturing industry.

The companies also plan to build factories in the United States - producing logic chips and advanced packaging respectively - as part of a wave of more than $200 billion in private semiconductor investment spurred by the CHIP Act.