November 23, 2009 / 8:27 AM / 10 years ago

UPDATE 1-TowerJazz gets $130 mln Asian contract, shares jump

* Signs deal with Asian entity for $130 mln

* To provide know-how, training, manufacturing solutions

* Shares surge 8.5 percent

(Adds details, CEO quote, background)

TEL AVIV, Nov 23 (Reuters) - Israeli chip maker TowerJazz (TSEM.O) (TSEM.TA) said on Monday it signed an agreement with an Asian entity that will provide it with revenue of $130 million, mainly during the first contract year of 2010.

Its Tel Aviv-traded shares opened up 8.5 percent at 4.23 shekels.

Under the agreement, TowerJazz will arrange for the required manufacturing know-how and certain equipment required for successful capacity ramp-up.

The deal will help TowerJazz further its strategy to penetrate Asian markets and leverage its manufacturing know-how and assets to expand in this region. This follows numerous new customer contracts announced in Asia.

“We expect that this project will strengthen our traction in this geographic area and trust that our Asian customer base will multiply as a result,” Russell Ellwanger, chief executive officer of TowerJazz, said in a statement.

TowerJazz was formerly called Tower Semiconductor. (Reporting by Tova Cohen; Editing by David Holmes) ($1 = 3.80 shekels)

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