Government may become the largest intel shareholder
The Trump administration is considering taking a 10% stake in Intel Corp., Bloomberg said. If the transaction is completed, the U.S. government will become the largest individual shareholder of the ailing chipmaker. At Intel’s current market value, that position would be worth around $10.4 billion.
Officials are reported to be weighing the question of whether to swap all or part of the company’s $10.9 billion in 2022 CHIPS and Science Act grants for stock. Intel received $7.9 billion to boost domestic production and another $3 billion for semiconductor manufacturing involving national security.
CHIPS act funds at the center of the debate
The CHIPS Act, signed in 2022 in a rare instance of bipartisan unity, provided $39 billion to support increased chip manufacturing in the U.S. While President Trump has favoured the general purpose of the Act, he has condemned its spending structure himself and even petitioned for its repeal this year.
Commerce Secretary Howard Lutnick reported in June that the administration was rethinking some of these grant contracts. Turning Intel’s grants into equity would mean fewer dollars going directly to the company, but it would make the government more directly invested in Intel’s future.
Intel’s challenges and national security issues
Having dominated the global chip industry, Intel has trailed its rivals in advanced manufacturing, including Taiwan’s TSMC and South Korea’s Samsung. To revive the company is now a national priority, with Washington viewing domestic production of semiconductors as important to economic competitiveness as to security.
Experts differ on whether government ownership is the answer. Some opine that Intel’s issues run deeper than cash, citing management failure and missed opportunities in the revolution involving artificial intelligence. Others feel that a federal takeover would inject stability, ensure production capacity, and help preserve dominant U.S. technologies.
Investor reactions: Rally, drop, and recovery
Intel investors initially welcomed reports of possible government support. Stock rose almost 9% on August 14 when rumours of the stake first surfaced. But following the Bloomberg report on the possible equity swap, shares fell over 3% on Monday before reversing more than 5% in late trading after a report of a standalone investment.
On Tuesday, SoftBank announced it would invest $2 billion in Intel and become its fifth-largest shareholder. SoftBank CEO Masayoshi Son described Intel as “critical to expanding U.S. semiconductor manufacturing”, an indication of trust in the company’s long-term vision.
Trump, Intel CEO, and shifting white house views
Intel CEO Lip-Bu Tan, who took over in March 2025, recently sat down with President Trump at the White House. Trump had previously called for Tan’s removal, citing his Chinese connections, but appeared to soften after meeting with him, stating Tan has “an amazing story”. Whether the proposed government stake came up then is not clear.
The government has not yet said whether it will make the investment and on what scale any resulting stake would be. Intel and the White House have declined to comment on the report outside the confines of a story.
Building national champions or picking winners?
If agreed, the deal would be one of the most forceful cases of Washington stepping into a private company to take control of a strategic industry. While supporters see it as a way of keeping America from falling behind in making chips, critics worry that it will usher in a period of government “picking winners” rather than letting market forces prevail.
For now, the plan is on the table. Whether the government acquires a controlling stake—or if Intel can turn around without explicit government investment—remains to be seen.
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