Quick overview

---

Commerce Secretary Howard Lutnick announced the acquisition of a 10% stake in struggling chipmaker Intel. Intel increased by roughly 6% on Friday. Long-term trading remained flat.

 

The government invested $8 billion in Intel common stock, purchasing 433.3 million shares at $20 each, giving it a 10 percent stake in the company, according to a press release from Intel, the only American company capable of producing advanced chips on U.S. soil. The price the government paid, according to Intel, was less than the market rate. $32 billion will come from separate government awards under a program to make secure chips, with $57 billion of the total coming from grants under the CHIPS Act that had been awarded but not yet disbursed.

In a post on Truth Social, President Trump stated, “The Shares are now valued at $11 billion, and the United States paid nothing for them.”

America and Intel stand to gain significantly from this deal. If Intel no longer owns the majority of its foundry business, the government will also have the right to purchase an additional 5% of its shares. According to Intel, the U.S. government will not have any governance rights or a seat on the board. It is the only semiconductor company in the United States that conducts research and development of cutting-edge logic chips

Intel CEO Lip-Bu Tan stated, “Intel is steadfastly dedicated to guaranteeing that the most cutting-edge technologies in the world are produced in the United States.”

Taiwan Semiconductor Manufacturing Company, which produces chips for Apple, Nvidia, Qualcomm, and AMD, is thought to have more advanced technology than Intel.

Intel has been investing billions of dollars to build several chip factories in Ohio to produce the most advanced chips, including those for artificial intelligence, which the company formerly called the “Silicon Heartland.”

However, Tan informed staff in a July memo that there would be “no more blank checks” and that, depending on market conditions, the construction of its Ohio factory complex. The new opening date for Intel’s Ohio plant is 2030.