INCHEON (Yonhap) -- Amkor Technology, Inc., a leading U.S. provider of semiconductor assembly and test services, will build a chip plant and a global research lab in the western port city of Incheon, the municipal government said Sunday.

Amkor Technology signed a preliminary deal with the city government on Friday to invest $1 billion to construct the facilities in the city's free economic zone, about 40 kilometers west of Seoul, city officials said.

The deal calls for Amkor Technology to build a sophisticated assembly line and a research and development center in Incheon's Songdo area by 2019.

If completed, the facility will have the capacity to package and test more than 25 billion semiconductors per year, the officials said.

A Nasdaq-listed company, Amkor Technology currently runs 11 factories in five countries with annual revenue of $2.8 billion and a workforce of 20,000. (Yonhap)