David Awoyode
The United States government has struck a deal to purchase a 9.9% stake in Intel, marking a rare case of direct federal investment in a private corporation. The agreement involves an $8.9 billion purchase of Intel common stock, announced on Friday.
Details of the Agreement
Intel confirmed that the government would acquire 433.3 million primary shares at $20.47 each, giving taxpayers a discount compared to the current market price. Combined with $2.2 billion in CHIPS Act grants already awarded, the total federal support for Intel now stands at $11.1 billion.
Passive Ownership, No Control
The investment will be a passive stake. Intel clarified that the government will not have board representation or special governance rights, and will generally vote in line with Intel’s board.
Trump Praises the Deal
President Donald Trump highlighted the agreement during remarks at the White House, saying he pushed Intel CEO Lip-Bu Tan to accept government partnership. According to Trump, he told Tan: “I think the United States should be given 10% of Intel… I think it’s a great deal for them and for us.”
Intel Stock Reacts
News of the investment boosted Intel’s stock nearly 6% by market close Friday, although it dipped slightly in after-hours trading once the deal was confirmed.
A Struggling American Giant
Intel has lost ground in the global semiconductor race, with competitors like Taiwan Semiconductor Manufacturing Company (TSMC) taking the lead. The company is working on a turnaround while also facing political scrutiny.
Political Tensions Around CEO
Trump previously called for Intel CEO Lip-Bu Tan’s resignation due to alleged Chinese business ties. But after meeting Tan earlier this month, Trump shifted his stance, praising him and reaching an agreement instead.
Treasury’s Reassurance
Treasury Secretary Scott Bessent emphasized that the government would not use its Intel stake to exert pressure on businesses, saying: “The last thing we’re going to do is take a stake and then try to drum up business.”
Reviving the US Semiconductor Industry
Trump’s administration continues to promote domestic chip production as part of its AI Action Plan, arguing that strengthening Intel and other US producers will secure supply chains, protect national security, and create high-paying jobs.
Part of a Larger Strategy
The Intel deal follows similar federal interventions, such as the Pentagon’s $400 million stake in MP Materials and the government’s “golden share” in United States Steel Corp. Together, these moves reflect Washington’s shift toward direct industrial involvement in critical sectors.
