WASHINGTON, May 23 (Reuters) - The US Commerce

Department said on Thursday it plans to grant $75 million to

Absolics for constructing a 120,000-square-foot facility in

Georgia that will supply advanced materials to the country's

semiconductor industry.

The planned award to the semiconductor packaging provider,

an affliate of SKC Co, which in turn is part of South Korea's

second-largest conglomerate SK Group, is to come

from the U.S. government's $52.7 billion U.S. semiconductor

chips manufacturing and subsidy fund.

The funds will develop technology for advanced packaging,

marking the first commercial facility to support the

semiconductor supply chain with a new advanced material.

The Commerce Department said the award will also support

1,000 construction jobs and 200 manufacturing and R&D jobs in

Covington, Georgia.

Absolics' glass substrate allows for processing and memory

chips to be packed into a single device allowing for faster,

more efficient computing.

The company, which was created in 2021, broke ground on the

Georgia plant in November 2022. Applied Materials ( AMAT ) is an

investor.

CEO Jun Rok Oh said in a statement the proposed funding will

allow the company "to fully commercialize our pioneering glass

substrate technology for use in high-performance computing and

cutting-edge defense applications."

The Commerce Department said glass substrates from Absolics

will be used to boost performance of leading-edge chips for AI

and data centers.

Last month, SK Hynix,

the world's second-largest memory chip maker,

said it would invest $3.87 billion to build an advanced

packaging plant and R&D facility for AI products in Indiana.

U.S. Commerce Secretary Gina Raimondo, who previously noted

the advanced packaging substrates market is currently

concentrated in Asia, has made advanced packaging a priority and

said last year "the U.S. will develop multiple high-volume

advanced packaging facilities."

In November, the Commerce Department disclosed details of

its plans to spend $3 billion in support of advanced packaging.

The same month, Amkor Technology ( AMKR ) said it would

spend $2 billion to build a new advanced packaging and test

facility in Arizona that will package and test chips for Apple ( AAPL )

produced at a nearby Taiwanese chipmaker TSMC

facility.

That department recently announced several major proposed

awards from the chips program including $8.5 billion in grants

for Intel ( INTC ), $6.6 billion for TSMC, $6.4 billion for

South Korea's Samsung and $6.1 billion for memory

chip maker Micron Technology ( MU ).