CORK-BASED semiconductor company Ferfics has secured €1.7 million in new equity funding which will help it start production of an energy efficient microchip in the first half of 2011.

The chip is being produced for mobile and wireless devices and according to the company is cheaper than rival components to manufacture and operate.

The investment is led by the Ulster Bank Diageo Venture Fund, which is managed by NCB Ventures. Investment is also included from the AIB Seed Capital Fund, managed by Enterprise Equity Venture Capital Group, and Enterprise Ireland.

“The investment is for two purposes really; to support the rapid production and to develop the research and development team,” said Eugene Heaney, founder and chief executive of Ferfics.

The company was founded in 2007 and is based at the Rubicon Centre in Cork Institute of Technology. Ferfics said this new investment was likely to create around 30 jobs in the company over the next 18 to 24 months in areas such as research and development, quality control and marketing and sales. “It’s very important that you have very good people because you’re competing in a global market place and you really have to have people who can compete within that,” Mr Heaney said.

Production of the switch component will take place in the US which according to Mr Heaney is the only location with the right technology to produce the chip in high quantities. There are three large US companies already established and operating in the sector but he believed the product his company is producing could be the best in the industry.

Mr Heaney said while being Ireland-based might have been a disadvantage in these circumstances, his existing industry contacts meant it was not too hard for him to get access to his companys target customers.

Once the chip is developed Ferfics will aim to sell it on to module makers; from there it is hoped it will make its way into commercial products such as mobile phones and wireless receivers.