Intel confirmed on Friday that it had reached an agreement with President Donald Trump’s administration under which the United States government will take a 10 per cent stake in the chipmaker, without the injection of new funds.
The $8.9 billion investment, described by Intel as an acquisition of common stock, will be funded through grants previously awarded but not disbursed under the CHIPS Act and the Secure Enclave programme. Intel stated that $5.7 billion had been granted under the CHIPS Act and a further $3.2 billion under the Secure Enclave initiative.
US President Trump, writing on his platform Truth Social, said: ‘The United States paid nothing for these shares.’ He characterised the development as ‘a great Deal for America and, also, a great Deal for INTEL.’
Despite having criticised the CHIPS Act in the past, referring to it as a ‘horrible, horrible thing’, and urging its repeal, Trump expressed support for the agreement and praised Intel's leadership. Earlier this month, he accused Intel Chief Executive Lip-Bu Tan of conflicts of interest and called for his resignation. On Friday, however, he referred to Tan as ‘the Highly Respected Chief Executive Officer of the Company’ and credited him with negotiating the deal.
Intel noted in a recent filing that it had already received $2.2 billion under the CHIPS Act, with a further $850 million in reimbursements requested but not yet disbursed.
According to The New York Times, some legal experts have questioned the legality of converting federal grants into equity stakes, suggesting that the deal may face legal scrutiny.
Tan stated that Intel is ‘grateful for the confidence the President and the Administration have placed in Intel, and we look forward to working to advance U.S. technology and manufacturing leadership.’
Intel confirmed that the government’s role would remain passive, with no board representation or governance rights associated with the shareholding.
