US government takes 10 percent stake in Intel in exchange for money it was already on the hook for
1 min read
Summary
The US government will take a 10% stake in Intel in exchange for $8.9bn, which will largely be funded through unspent grants from president Biden’s CHIPS Act and previous funding from the Secure Enclave programme.
President Trump announced the deal during a press briefing, after stating that the deal would help Intel CEO Lip-Bu Tan keep his job, despite calling for him to resign earlier this month due to his China ties.
Intel has been hit by a series of controversies in recent months, including fines from the EU for anti-competitive behaviours, imminent job cuts, and the recent departure of multiple key executives.
This comes shortly after SoftBank announced a $2bn investment into Intel, and amid reports that the Trump administration is demanding AI chipmakers Nvidia and AMD give the US government a 15% cut of all chip sales to China.
It is unclear whether the deal constitutes good value for money for US taxpayers, given Intel’s recent struggles.
The move further blurs the line between the US government and US business.