The U.S. government has announced a $8.9 billion investment in Intel, acquiring a 10% stake in the chipmaker. President Donald Trump and Commerce Secretary Howard Lutnick revealed the deal, which stands out as one of the largest commercial agreements Washington has struck with an American corporation since the 2008 auto industry bailouts. The investment was reportedly made at a premium price.
Speaking at a press conference, Trump described the deal as “a tremendous opportunity for both America and Intel.” He added that the decision came after his recent meeting with Intel CEO Lip-Bu Tan. Intel clarified that the government will not gain any board seats or managerial rights as part of the transaction.
Under the agreement, the U.S. government purchased 433.3 million Intel shares at $20.47 per share. Without the special arrangement, officials noted, the government would have had to pay close to $11 billion for the same amount of stock.
Funding for the investment will partly come from programs already in place. Around $5.7 billion will be sourced from grants allocated under the CHIPS Act—a Biden-era initiative aimed at boosting domestic semiconductor production—though the payments had yet to be distributed. The remaining $3.2 billion will be drawn from other federal support schemes.
What makes the deal particularly noteworthy is its connection to the CHIPS Act. Last fall, Intel announced it was set to receive $8 billion in subsidies from the program to finance its new Ohio factories. Yet, the process stalled for months. Now, a similar amount is being delivered through a government equity purchase, sparking speculation in Washington and on Wall Street. Some reports suggest Intel may have been pressured into parting with its shares in order to finally secure the subsidies it had long awaited.
Leave a Reply