Intel Capital, the investment arm of Intel Corporation, has bought 4 percent of semiconductor equipment manufacturer ASM International (also known as ASMI) through open market transactions.

ASMI is a Netherlands-based supplier of chemical vapor disposition and other semiconductor production equipment to integrated circuit manufacturers such as Intel and AMD.  ASMI’s equipment and materials are used in wafer processing, assembly, and packaging of semiconductor devices. It is the second largest such company in Europe, with shares traded on the NASDAQ and in Europe through NYSE Euronext.

"Equipment and materials innovation is critical to enabling new capabilities in semiconductor device manufacturing," said Arvind Sodhani, Intel's Executive Vice President and President of Intel Capital. "Our investment in ASMI is part of Intel Capital's strategy to foster innovation that aligns with Intel's manufacturing technology roadmap."

Intel is currently refining its P1268 32nm process at its D1D development fab in Oregon. It will start mass production of 32nm Westmere-based CPUs in Q4 of this year at its D1D and D1C fabs, with some work being done at Aloha Factory Operations as well.

Additional production will also start in 2010 at Intel's Fab32 "Megafab" in Chandler, Arizona, followed by Fab 11X in Rio Rancho, New Mexico. The world's largest semiconductor company is spending $7 billion over the next two years on equipment for 32nm, much of which could be spent on equipment from ASMI.

One of the biggest players in the semiconductor equipment market is ASML, which ASMI co-founded in 1984 in a partnership with Phillips. ASML holds over 60 percent of global lithography sales in the semiconductor industry, but both companies have been hit hard by the global recession.

Intel is not the only company putting money into ASMI. Tokyo Electron Limited (TEL), another semiconductor equipment manufacturer, bought 4.9 percent of ASMI last week as part of a "long-term investment strategy".