Canadian fund Awz to invest NIS 5b in Ashkelon chip plant

For the first time since Intel’s decision to build a factory in Kiryat Gat nearly 20 years ago, a new chip factory in Israel is scheduled to be built in Ashkelon. The plan was initiated by Yaron Ashkenazi’s Canadian defense technology investment firm, which employs former Israeli army chief of staff Aviv Kochavi, former Israeli police chief Roni Alsheikh, and former Canadian prime minister Stephen Harper as advisors.

This is an ambitious plan, in which the total investment could reach 40 billion shekels, to create a complex that includes research and development centers, a silicon wafer manufacturing plant, and an assembly, testing and packaging plant, which will cover a total area of ​​70 thousand square meters in the Ashkelon industrial zone, and will include 350 employees, including 150 in research and development. The initiative is still only in its early stages, and according to estimates, the fund is in the process of raising capital to purchase the land

Oz, a veteran defense technology fund that has so far raised $500 million in venture capital investments, intends to develop the factory for dual-use applications – that is, dedicating the production of some chips to Israel’s defense industries and defense system – so that the focus of the factory’s activities will be reflected in deep technology and photonic chip technologies. However, the chips will also be suitable for commercial industries in Israel such as the automotive sector, telecommunications, quantum computing and medical devices. According to Oz’s announcement, the immediate investment will reach 5 billion shekels, in cooperation with the Ministry of Economy and Industry, the Ashkelon Municipality, the Ministry of Finance, the Israel Lands Authority, and the Israel Innovation Authority.

Startups and academic institutes will have access to the facilities

The factory plans to develop and produce chips that are critical for artificial intelligence infrastructure, quantum computing, 5G and 6G communications, and a variety of strategic security applications. Oz, “This is the first private factory of its kind in Israel to produce chips based on chemical compounds of the V-III family embedded in silicon and other substrates.” She added that the factory will operate in a hybrid manner, allowing the integration and modernization of production lines with other factories in Israel and abroad, and in an open format that will also allow startups and academic institutes to access it.

Yaron Ashkenazi, Founder and CEO of Awz, said, “The chip factory will be the beating heart of a new national deep-tech center to be established in the Tierra Park industrial park in Ashkelon, with a total investment of NIS 5 billion, of which NIS 3 billion will be in the first phase. This factory joins Awz’s previous investments totaling more than NIS 2 billion over the past 8.5 years in Israeli startups developing leading deep-tech technologies with dual use – defense.” And commercial.”

The foundation stone laying ceremony for the chip factory was attended this morning in Ashkelon by Minister of Economy and Industry Nir Barkat, Minister of Economy and Industry Director General Moti Haggai, and Mayor of Ashkelon Tomer Gholam.

Published by Globes, Israel Business News – en.globes.co.il – on November 13, 2025.

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