US Seeks Intel Stake in Exchange for Federal Grants

Name: US Seeks Intel Stake in Exchange for Federal Grants
Uploaded: 2025-08-20T03:52:40.000Z
Description: 'We should get an equity stake for our money,' Commerce Secretary Howard Lutnick said.

'We should get an equity stake for our money,' Commerce Secretary Howard Lutnick said.

Andrew Moran

Published: 8/19/2025, 4:51:03 PM EDT

The U.S. government is seeking an equity stake in chipmaker Intel, Commerce Secretary Howard Lutnick said on Aug. 19.

In November 2024, the previous administration awarded Intel nearly $11 billion in grants from the CHIPS and Science Act—legislation designed to bolster U.S. semiconductor production—to support its domestic manufacturing investment plans.

Rather than giving away grants, President Donald Trump thinks the United States “should get the benefit of the bargain,” according to Lutnick.

"We should get an equity stake for our money, so we’ll deliver the money which was already committed under the Biden administration," Lutnick told CNBC's "Squawk on the Street” in Tuesday's interview. "We’ll get equity in return for it, get a good return for the American taxpayer instead of just giving grants away."

The federal government would not obtain a voting stake or governance rights to direct Intel’s operations through the investment, he said. Lutnick did not disclose the government's proposed total stake in Intel.

White House press secretary Karoline Leavitt told The Epoch Times at an Aug. 19 press briefing that the Department of Commerce continues to "iron out the details" to secure a government stake in Intel.

"The president wants to put America's needs first from a security and economic perspective," Leavitt said. "It's a creative idea that has never been done before to ensure that we're both reshoring these critical supply chains while also gaining something in return."

White House press secretary Karoline Leavitt speaks during a press briefing at the White House on Aug. 19, 2025. Madalina Kilroy/The Epoch Times

The administration’s newest policy initiative comes as the $110 billion company announced Japan’s SoftBank will invest $2 billion in Intel common stock to “deepen their commitment to investing in advanced technology and semiconductor innovation in the United States.”

Shares of Intel increased by as much as 11 percent during the Aug. 19 trading session, bringing the stock’s year-to-date gain to about 27 percent.

Earlier this month, Trump urged Intel CEO Lip-Bu Tan to resign over alleged ties to Chinese technology companies.

"The CEO of Intel is highly conflicted and must resign, immediately. There is no other solution to this problem," Trump said in an Aug. 7 post on Truth Social.

Days later, on Aug. 11, after meeting with Tan, the president said in a Truth Social post: "The meeting was a very interesting one. His success and rise is an amazing story. Mr. Tan and my Cabinet members are going to spend time together, and bring suggestions to me during the next week."

Ultimately, Lutnick said, the administration aims to help Intel succeed and ensure that the United States becomes a global leader in chip production.

"We want Intel to be successful in America," he said. "We’d like an American transistor built in America, right? We’d like an American to be doing that."

New Administration Policy

In recent months, Trump and his administration have forged working relationships with some of the largest companies in today's key industries.

The president recently granted export licenses for chipmakers Advanced Micro Devices (AMD) and Nvidia, permitting them to resume sales of certain AI chips to China. As part of the agreement, the U.S. government will receive 15 percent of the revenue generated from these transactions.

In June, Trump approved the acquisition of U.S. Steel by Japan’s Nippon Steel after the companies extended the U.S. government a "golden share." This special provision gives the government the authority to appoint a board member and veto decisions that would reduce the workforce or scale back capital investments.

The Department of Defense became the largest shareholder in U.S.-based rare earths mining company MP Materials last month, purchasing $400 million in preferred stock.

U.S. Secretary of Commerce Howard Lutnick speaks at the Pennsylvania Energy and Innovation Summit at Carnegie Mellon University in Pittsburgh on July 15, 2025. (Samira Bouaou/The Epoch Times) — U.S. Secretary of Commerce Howard Lutnick speaks at the Pennsylvania Energy and Innovation Summit at Carnegie Mellon University in Pittsburgh on July 15, 2025. Samira Bouaou/The Epoch Times

Typically, Washington has only obtained direct stakes in companies during economic upheaval. At the onset of the 2008–09 global financial crisis, the federal government acquired stakes in insurance juggernaut American International Group (AIG), automaker General Motors, Bank of America, and Citigroup.

Solar panel startup Solyndra received government-backed loans following the passage of the Obama-era American Recovery and Reinvestment Act. Years later, the company collapsed, costing U.S. taxpayers about $528 million.

One analyst is skeptical that government involvement will revive the company after falling behind several industry rivals, including AMD, Broadcom, Nvidia, and TSMC, in recent years.

"Generally speaking, Intel is so far behind on the technology that it may serve some purpose, but I don't see the benefit to the American taxpayer, nor do I see the benefit, necessarily, to the chip industry," Nancy Tengler, CEO and CIO at Laffer Tengler Investments, said in a note emailed to The Epoch Times.

Allowing the private sector to overhaul the company would be a preferable option, she said.

"They'll fix the problems quickly," she added.

"I don’t care how good of a businessman you are, give it to the private sector and let people like me be the critic and let the government get to the business of government."

From The Epoch Times