Trump Announces U.S. Government's 10% Stake in Intel

Aug 24, 2025, 3:09 AM

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President Donald Trump declared that the US government has secured a 10% stake in Intel through an agreement converting federal grants into equity, positioning the administration as one of the chipmaker’s largest shareholders . The deal involves an $8.9 billion investment in Intel common stock, valued at $20.47 per share, granting the government approximately 9.9% ownership . This marks a pivotal moment in US-tech corporate relations, blending public and private sector interests under Trump’s second term agenda.

The agreement emerged after Trump initially demanded Intel CEO Lip-Bu Tan’s resignation due to concerns over his past ties to Chinese tech firms. However, Tan retained his position by publicly affirming his allegiance to the US, leading to negotiations that culminated in the stake deal . Commerce Secretary Howard Lutnick emphasized the move strengthens "US leadership in semiconductors," aligning with national security and economic goals . The government’s equity stake is funded by $5.7 billion in unpaid CHIPS Act grants and $3.2 billion from the Secure Enclave program, reflecting a strategic reallocation of public funds .

Intel confirmed the deal, stating it would "advance key national priorities" while maintaining operational independence. The company’s press release noted the government holds non-voting shares, avoiding direct governance interference. This approach contrasts with past interventions like the 2008 GM bailout, where the US took a 60% stake and later sold it at a loss . Analysts caution that while the deal may stabilize Intel’s finances, it could complicate future grant programs by introducing equity-based incentives .

The move also coincides with Japan’s SoftBank Group investing $2 billion in Intel, signaling renewed confidence in the chipmaker’s turnaround. However, Intel faces ongoing challenges, including a market cap of around $110 billion and struggles to compete with rivals like Nvidia and TSMC in advanced AI chip technology . Trump’s administration has also imposed 15% commissions on Chinese sales by Nvidia and AMD, creating a precedent for leveraging export controls as financial tools .

This development underscores the Trump administration’s focus on reshaping global supply chains. By securing a stake in Intel, the US aims to reduce reliance on foreign semiconductor production, a priority highlighted during the Biden-era CHIPS and Science Act. Critics warn of potential corporate risks, noting the unconventional nature of government equity stakes in private firms. Nonetheless, the deal reflects a broader strategy to intertwine national security with economic policy, positioning Intel as a cornerstone of America’s technological edge in the AI-driven global economy .

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