Historic Acquisition: US Government Purchases 10% Stake in Intel for $8.9 Billion
In a move that marks a significant shift in US industrial policy, the Trump administration announced in August that the US government will acquire a 9.9% equity stake in Intel Corp for $8.9 billion. This acquisition makes the US government the largest single shareholder in the chipmaker, converting existing CHIPS Act grants into equity ownership.
As per the agreement, the government will purchase 433.3 million shares at $20.47 per share. The purchase will be funded by $5.7 billion in unallocated CHIPS grants and $3.2 billion from the Defense Department’s Secure Enclave program. Despite the significant stake, the government will not have board representation but will generally vote in alignment with management.
This acquisition comes at a time when Intel is grappling with competition from Nvidia and other rivals in the AI chip market. President Trump has indicated that this could be the first of several government equity stakes in critical technology companies, signaling a potential new trend in government-industry relations.
Source: NPR