US Government to Take 10 Percent Equity Stake in Intel

US President Donald Trump confirmed that the US government has struck a deal for a 10% equity stake in Intel. The arrangement includes converting Intel’s funding from the US CHIPS and Science Act in return for the 10% holding.

The US government entered talks with Intel about taking a stake in the chipmaker after President Donald Trump appeared to soften his stance on a call for CEO Lip-Bu Tan to resign immediately. “He walked in wanting to keep his job, and he ended up giving us $10 billion for the United States. So we picked up $10 billion,” Trump said.

The government’s equity stake will be funded by the remaining $5.7 billion in grants previously awarded, but not yet paid, to Intel under the CHIPS and Science Act and $3.2 billion as part of the Secure Enclave program. Intel stated it will continue to deliver on its Secure Enclave obligations and reaffirmed its commitment to delivering trusted and secure semiconductors to the Department of Defense. The $8.9 billion investment is in addition to the $2.2 billion in CHIPS grants Intel has received to date, making for a total investment of $11.1 billion.

Trump’s interest in propping up the chipmaker is part of a move by his administration to strengthen domestic semiconductor manufacturing across sectors it deems central to US national security. Earlier this week, Intel received a $2 billion capital injection from SoftBank Group.