President Donald Trump on Friday said Intel Corp. has agreed to hand over a 10% stake of its business to the U.S. government for roughly $10 billion.
“They’ve agreed to do it, and I think it’s a great deal for them,” Trump told reporters in the Oval Office.
An official announcement was made later, when Commerce Secretary Howard Lutnick posted on social-media site X a photo of himself with Intel CEO Lip-Bu Tan and wrote, “This historic agreement strengthens US leadership in semiconductors, which will both grow our economy and help secure America’s technological edge.”
The whirlwind deal comes after Trump met with Tan last week, following his calling on Tan to resign over his past ties to China. On Friday, Trump offered details on how the agreement was reached.
“He came in, he saw me, we talked for a while. I liked him a lot. I thought he was very good. I thought he was somewhat a victim, but, you know, nobody’s a total victim, I guess,” Trump said. “And I said, ‘You know what? I think the United States should be given 10% of Intel.’ And he said, ‘I would consider that.’ Intel has been left behind, as you know, compared to [NVIDIA Corp. CEO] Jensen [Huang] and some of our friends.”
The Trump administration has been talking with Intel about a stake in exchange for converting government grants pledged to the struggling company under former President Joe Biden and the CHIPS and Science Act (2022). The storied Silicon Valley company has lagged in the race to product artificial intelligence (AI) chips behind NVIDIA, AMD, Qualcomm Inc., and others.
Under the deal, the U.S. government would become one of Intel’s largest shareholders. A government stake in Intel could also serve as a model for other investments by the administration, which has been weighing opportunities to take similar stakes in various American companies in critical industries.
Intel is also talking to large investors about an equity position in the company at a discounted price, CNBC reported Wednesday. Earlier this week, SoftBank Group took a $2 billion investment in the battered chipmaker. Daniel Newman, CEO of The Futurum Group, said SoftBank’s action “further reiterates Intel will be making chips for Arm. Arm will need capacity for its AI chips. Win for Intel, Arm, and SoftBank.”
Trump’s interest in Intel, NVIDIA, and other domestic chipmakers has been motivated by his desire to boost chip production in the U.S. and lessen its reliance on chips manufactured overseas as he wages a trade war against China and the rest of the world. The administration is requiring NVIDIA and Advanced Micro Devices to pay a 15% cut on their sales of chips in China in exchange for export licenses.
