Trump administration weighs 10% stake in Intel via Chip Act grants

The Trump administration is discussing taking a ten% stake in Intel, in accordance with a Bloomberg report on Tuesday, in a deal that would see the U.S. authorities change into the chipmaker’s largest stakeholder.

As a part of a possible deal, the federal government can be contemplating changing some or all of Intel’s grants from the 2022 U.S. CHIPS and Science Act into fairness within the firm, the report mentioned, citing a White Home official and different folks aware of the matter.

On the embattled chipmaker’s present market worth, a ten% stake can be value roughly $10.4 billion. In the meantime, Intel has been awarded about $10.9 billion in Chips Act grants, together with $7.9 billion for business manufacturing and $3 billion for nationwide safety initiatives.

The report famous, nevertheless, that it stays unclear if the thought has gained traction broadly throughout the administration or whether or not officers have broached the chance with affected firms.

It added that the precise measurement of the stake stays in flux, and it stays unclear whether or not the White Home will really proceed with the plan. Intel and the White Home didn’t instantly reply to CNBC’s queries relating to the report. 

Intel, as soon as a dominant pressure within the U.S. chip business, has fallen behind international opponents in superior chip manufacturing. Reviving the previous U.S. chip champion has change into a nationwide precedence in Washington, with experiences a couple of potential authorities stake within the firm first circulating final week.

The corporate has been the biggest recipient of the 2022 Chips Act, handed with bipartisan assist underneath the Biden administration, as a part of efforts by Washington to revitalize U.S. management in semiconductor manufacturing.

The invoice allotted $39 billion in grants for American semiconductor manufacturing initiatives, with funding dedicated to most of the world’s chipmakers resembling TSMC and Samsung, in addition to American chip firms resembling Nvidia, Micron and GlobalFoundries. 

U.S. President Donald Trump, although supporting the final targets of the Chips Act, has been a vocal critic of the invoice and even known as for its repeal earlier this yr. Whereas republican lawmakers in Washington have been reluctant to behave on that decision, U.S. Commerce Secretary Howard Lutnick mentioned in June that the administration was renegotiating among the invoice’s grants. 

If Intel’s Chip Act funds have been to be transformed into a possible authorities stake within the firm, it may lower the whole quantity of capital infused into the corporate as a part of any deal by Washington. 

Nevertheless, it might function the newest instance of the Trump administration’s curiosity in constructing government-backed nationwide champions in strategic industries.

Intel has struggled to achieve a bonus within the synthetic intelligence increase and has but to seize a big buyer for its manufacturing enterprise regardless of spending closely on it. 

Some analysts have argued that authorities intervention is crucial for the struggling chipmaker and for the sake of U.S. nationwide safety. Others contend that Intel’s issues are deeper than funding, and it isn’t clear how the federal government may help with that. 

Analysts have additionally famous that Trump could possibly sway firms to purchase Intel chips or help not directly, by means of tariffs and regulation.

On Tuesday, it was introduced that SoftBank was investing $2 billion in Intel. In response to LSEG, the funding is value about 2% of Intel, making SoftBank the fifth-biggest shareholder. Masayoshi Son, Chairman & CEO of SoftBank Group, mentioned: “This strategic funding displays our perception that superior semiconductor manufacturing and provide will additional increase in the USA, with Intel enjoying a important position.”

Intel buyers had initially welcomed information of the federal government funding, which resulted in a share rally of practically 9% on Aug. 14. Shares of Intel fell over 3% on Monday on the Bloomberg report, however rebounded by greater than 5% in in a single day buying and selling on the buying and selling platform Robinhood following information of a Softbank funding.

Intel CEO Lip-Bu Tan, who was appointed in March 2025, met with Trump on the White Home final week, after the U.S. president had known as for his ousting attributable to his previous ties to China. 

After the assembly, Trump had modified his tune on the Intel chief, saying he had “an incredible story.” It is unclear if a possible authorities stake within the firm had been mentioned on the time.

Learn the complete Bloomberg story right here.