Chipmaker giant Intel has agreed to transfer nearly 10% of its shares to the U.S. government. On Friday, August 22, President Donald Trump and Intel jointly announced the historic deal in Washington.
Under the agreement, the U.S. government will receive 433.3 million common shares of the company, representing approximately 9.9% of total ownership. The total investment amounts to $8.9 billion, of which $5.7 billion will come from grants under the CHIPS and Science Act enacted during the Biden administration, which have not yet been distributed. The remaining $3.2 billion will come from awards under the Secure Enclave Program. Intel also stated that including a previously received $2.2 billion, the total grants now total $11.1 billion.
President Trump claimed that the U.S. became a 10% owner of Intel through this deal without spending any money. Posting on his social media platform Truth Social, he wrote that the agreement was made possible after a meeting with Intel CEO Pat Gelsinger. However, the company clarified that the government’s ownership stake would remain “inactive”—it would not have any board seats or management control.
Commerce Secretary Howard Lutnick wrote on X, “This agreement will further strengthen the leadership of the U.S. semiconductor industry.” Critics, however, have voiced concerns. Technology analyst Rob Enderle warned that government ownership could signal a move toward nationalization of private companies. Scott Lincicome, a researcher at the Cato Institute, said, “This decision is harmful for nearly everyone and poses a threat to Intel’s long-term viability.”
In recent years, Intel has lagged behind Asian competitors TSMC and Samsung. The CHIPS and Science Act, passed by the U.S. Congress, was an effort to revitalize the domestic semiconductor industry, allocating billions of dollars in grants.
Intel CEO Pat Gelsinger stated, “We are committed to ensuring that the world’s most advanced technologies are produced in the United States.” He noted that the company has already invested over $100 billion to expand its U.S. manufacturing facilities.
However, the deal has not been without controversy. Earlier this month, citing national security concerns, President Trump called for Gelsinger’s resignation. Meanwhile, Japan’s SoftBank recently announced a separate $2 billion investment in Intel.
Source: Reuters.