US Secures 10% Stake in Intel in a Historic Deal Worth $8.9 Billion
In a groundbreaking agreement, the US government has secured a 10% stake in chipmaker Intel, according to an announcement by the company and President Donald Trump. The deal, valued at $8.9 billion, marks a significant step in bolstering US leadership in the semiconductor industry.
Under the terms of the agreement, the US government will receive 433.3 million shares of common stock, representing a 9.9% stake in the company. This investment will be partially funded by $5.7 billion in grants awarded through the CHIPS and Science Act, a major law passed during President Joe Biden’s term.
President Trump hailed the deal as a major victory, claiming that the US “paid nothing” for the shares. Intel, however, clarified that the government’s investment would be a passive ownership with no board representation or governance rights.
Commerce Secretary Howard Lutnick emphasized the significance of the agreement, stating that it strengthens US leadership in semiconductors. However, not everyone shares the same optimism. Independent tech analyst Rob Enderle cautioned that the deal marks a “slippery slope” towards nationalizing private business, while Scott Lincicome of the Cato Institute warned that it could be detrimental to Intel’s long-term viability.
Intel CEO Lip-Bu Tan expressed the company’s commitment to ensuring the world’s most advanced technologies are American-made, stating that Intel is investing over $100 billion to expand its US sites. The deal comes as the US semiconductor industry faces stiff competition from Asian powerhouses TSMC and Samsung.
The agreement also follows a recent announcement by Japan-based tech investor SoftBank Group to invest $2 billion in Intel. As the US seeks to maintain its edge in the rapidly evolving tech landscape, this deal marks a significant step towards bolstering its leadership in the semiconductor industry.
