The European Commission said on Thursday it had approved a 920 million euro German state aid to Infineon for the construction of a new semiconductor manufacturing plant in Dresden.

The European Commission has approved a €920M German aid to Infineon Technologies (OTCQX:IFNNY) (OTCQX:IFNNF) to help build a new semiconductor manufacturing plant in Dresden. The measure will allow Germany-based Infineon to complete the MEGAFAB-DD project which will be able to produce a range of different types of chips,

The European Commission on Thursday signed off on German plans for €920 million ($960 million) in subsidies for the construction of an Infineon microchip factory in the eastern city of Dresden. European Commission approval was required for the subsidies because of the EU's single market regulations,

The European Commission approves the grant for Infineon's new semiconductor plant. The company makes commitments in return.

The aid will take the form of a direct grant of up to 920 million euros to Infineon to support its overall investment, amounting to 3.5 billion euros. Infineon, Germany’s largest semiconductor manufacturer, which was spun off from Siemens 25 years ago, has said the plant will be the largest single investment in its history.