Motorola said it plans to create its largest European semiconductor facility in Scotland, employing 1350 people over the next five years.
The company said it would invest £1.3bn in the 150 acre Dunfermline site, currently owned by Hyundai. The plant will manufacture chips designed for mobile phones and production is expected to begin in summer 2001.
Scotland's main economic agency, Scottish Enterprise, said it welcomed the announcement, which it said would put Scotland at the forefront of the latest semiconductor technology.
The agency said Hyundai had decided in June 1998 to delay plans to manufacture chips at the plant due to a downturn in the world market for semiconductors and economic problems in Korea.
Robert Crawford, Scottish Enterprise chief executive, said: "One of Motorola's key requirements was to get this project off the ground as quickly as possible. The fact that we had a facility ready and waiting, with scope for expansion, was a major advantage."
Motorola is already the largest manufacturing employer in Scotland, with a total workforce of 6,500 at its three plants in East Kilbride, South Queensferry, and Easter Inch.
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