Updated at 6:50 p.m. with statement from Soraa

SYRACUSE, N.Y. - Two years after Gov. Andrew Cuomo announced the state was building a $90 million factory where LED lightbulb manufacturer Soraa would create 420 jobs, the factory is nearly complete -- but Soraa has decided not to come.

Now the Cuomo administration is planning to sink another $15 million into the facility to bring in a different company.

NexGen Power Systems, a startup company from California, plans to manufacture semiconductors for the electronics industry in the 82,000-square-foot plant in DeWitt, said Howard Zemsky, CEO of Empire State Development.

NexGen has promised to invest $40 million of its own in the facility and to create at least 290 jobs within seven years, state officials said. The company plans to move in sometime around the middle of 2018.

Zemsky said Soraa decided not to use the facility about two months ago, after state officials declined the company's request to spend "tens of millions'' of dollars more to equip the factory, on top of the $90 million already spent.

Soraa had not spent any money on the plant, and it would have paid just $1 a year in rent. The company does not face any penalty for walking away.

"It was a mutual decision'' to part ways, Zemsky said.

Recruiting Soraa was considered a big victory in 2015. The company promised to spend more than $1.3 billion over 10 years on materials and manpower in Central New York. In addition to 250 employees of its own, the company was expected to spur 170 new jobs at local vendors and suppliers, state officials said.

Local leaders were ecstatic that Soraa planned to bring hard-to-find manufacturing jobs to the area. State Sen. David Valesky called it a "historic day for economic development.''

Construction of the DeWitt facility was delayed at least a year by a federal corruption probe of state contracts, including Cor Development Co.'s contract to build the Soraa plant. Two Cor executives have been charged with bid-rigging and are awaiting trial.

Empire State Development stepped in last year to manage the Soraa project, along with other projects that had previously been put together by SUNY Polytechnic Institute. Alain Kaloyeros, SUNY Poly's former president, also is awaiting trial.

Zemsky met throughout the year with Soraa officials. As recently as March he said they were still planning to come.

Zemsky said the delay may have been a factor in Soraa's decision to abandon the local plant. But he said Soraa also is facing competitive pressures from Asian manufacturers. The company ultimately decided not to invest in the DeWitt plant.

"I think they had imagined they would need more capacity than they actually need at present. Their existing capacity in California will hold them,'' Zemsky said. "From our standpoint, Soraa was looking for the state to invest considerably more funds in more tooling and so forth, which we didn't feel was the right investment for the state at this time.''

Late Thursday, a representative from Soraa released a prepared statement indicating that the company recently invested in new technology that quadrupled the capacity of its California factory, prompted by delays at the DeWitt site.

"These technical and material improvements have created capacity for years to come,'' the company said.

NexGen Power Systems was founded nine months ago in California's Silicon Valley and has a dozen employees, said Dinesh Ramanathan, president and CEO. The company will use the DeWitt plant for all its manufacturing and research and development, keeping only a small group of employees in California, he said.

State officials had previously worked with Ramanathan when he ran NexGen's predecessor company, Avogy Inc., which had planned to move to a state-owned clearnroom facility in Rochester. That deal never panned out, and Avogy went out of business last year.

NexGen bought Avogy's intellectual property and started over this year with new money from investors, Ramanathan said. The company will be ready to start making semiconductors by July, and plans to start selling products by the end of 2018.

He declined to say how much the company has raised, but said it's enough to meet its commitments at the DeWitt manufacturing plant.

NexGen's business is to make semiconductor power devices from gallium nitride, the same material that Soraa uses to make LED lighting. That similarity will enable them to use some of the equipment already built into the factory that was designed for Soraa, Zemsky said.

Gallium nitride is a more efficient semiconductor material than silicon, creating the potential to make electronic devices that are smaller, lighter and more efficient, Ramanathan said.

NexGen's focus on cutting-edge semiconductors fits well with the state's efforts to build a high-tech corridor across Upstate, Zemsky said.

Zemsky conceded that there is "inherent risk with any early-stage technology business.'' But he said there is also a big potential for NexGen's technology to disrupt the semiconductor business and generate growth. State officials are confident in the management team and say the company is well-capitalized, he said.

"NexGen is led by a management team and investors with a proven record and decades of combined experience building and operating high-tech businesses,'' Zemsky said. "This gives us the confidence that the company will meet its commitment to bring hundreds of new, good-paying jobs to Central New York.''

The directors of Empire State Development will vote tomorrow on the $15 million grant to NexGen. State officials said the 10-year contract will require some repayment if NexGen does not meet certain milestones, but details were not available today.

The factory is still owned by Fort Schuyler Management Corp., a nonprofit affiliate set up by SUNY Polytechnic to manage real estate deals. State officials have negotiated a 10-year lease under which NexGen will pay $1 the first year and increasing amounts up to full market value in the 10th year.

Fort Schuyler Management is expected to vote on the lease at its January meeting, state officials said.

Ramanathan said NexGen could start posting job openings for R&D engineers as early as mid-January.

Contact reporter Tim Knauss | email | Twitter | 315-470-3023