U.S. Government Seeking Equity stake in Intel as Part of CHIPS Act Funding
Intel is reportedly in discussions with the U.S. government to grant a 10% equity stake in exchange for funding from the CHIPS and Science Act. President Donald Trump announced Friday that Intel CEO Pat Gelsinger had agreed to the arrangement, calling it “a grate deal for them.” The two were scheduled to meet Friday afternoon, according to White House officials.
This move represents a shift in U.S.industrial policy towards greater government involvement in the private sector. Lutnick,a source familiar with the negotiations,previously stated on CNBC’s “Squawk on the street” that the government should receive an equity stake in return for providing financial support. ”We should get an equity stake for our money,” Lutnick said. “So we’ll deliver the money, which was already committed under the Biden governance. We’ll get equity in return for it.”
Intel recently secured additional investment from SoftBank, which committed $2 billion – approximately 2% of the company - to the chipmaker. The company, currently valued at just over $100 billion, is investing heavily in new manufacturing facilities, including a large complex in Ohio, aiming to become a leading producer of advanced chips, including those for artificial intelligence.
Though, Intel has recently slowed down construction of its Ohio factory, citing market conditions, and now anticipates operations to begin in 2030. the company finalized a nearly $8 billion grant from the CHIPS and science Act in November 2024 to support these factory-building plans.intel’s chip technology currently lags behind that of Taiwan semiconductor Manufacturing Company (TSM), a major supplier for companies like Apple, Nvidia, Qualcomm, and AMD, as well as Intel itself.
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