Uncle Sam eyes slice of Intel in return for CHIPS Act cash
- Reference: 1755694811
- News link: https://www.theregister.co.uk/2025/08/20/us_stake_intel/
- Source link:
Commerce Secretary Howard Lutnick said that Intel would be required to give the federal government an equity stake in the company in return for its CHIPS Act subsidy cash, which was granted last year under the previous administration.
Intel finalized its [1]agreement with the Commerce Department last November, a deal that would see it receive up to $7.86 billion to help fund its semiconductor fabrication plants and advanced packaging projects at sites in Arizona, New Mexico, Ohio, and Oregon.
[2]
"We should get an equity stake for our money," Lutnick told [3]CNBC . "So we'll deliver the money, which was already committed under the Biden administration. We'll get equity in return for it," he added.
[4]
[5]
The move appeared to be confirmed by White House Press Secretary Karoline Leavitt, but she later walked back the claim to say that the government was "working on it" and "ironing out the details," as part of efforts to bring critical supply chains back to US soil while also gaining something from the deal for the American taxpayer. The Register asked Intel to comment.
But Intel is not the only semiconductor biz to be awarded grants or subsidies under the CHIPS Act. Memory chipmaker [6]Micron scored $6.1 billion toward the development of its new facilities in New York state and Idaho, while Taiwanese silicon giant [7]TSMC secured $6.6 billion to expand its manufacturing presence on US soil. Other beneficiaries include [8]Samsung and [9]GlobalFoundries .
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According to [11]Reuters , a White House official confirmed that Lutnick is also looking into the US government receiving equity stakes in these companies in exchange for their CHIPS Act funding.
If true, this would be an unusual step for the US government to take, using taxpayers' money to acquire a stake in private businesses, and has been likened by some observers to communism.
However, the Trump administration has a certain degree of ambivalence toward the CHIPS Act program, which was aimed at boosting America's semiconductor manufacturing capabilities.
[12]Intel ghosts researcher who found web apps spilled 270K staff records
[13]AWS still cares enough about Intel to order up a fresh batch of custom Xeons
[14]Softbank bets $2 billion on Intel having a future
[15]Trump does a 180 on Intel chief following White House meeting
Earlier this year, the president [16]called for the CHIPS Act to be scrapped , and suggested that any remaining funds not disbursed should instead be used to help pay off national debt. House Speaker Mike Johnson also suggested last year that the Republican party would [17]move to repeal the bill that enacted the program, before later backtracking on the claim.
More recently, Lutnick had suggested that the [18]agreements covering CHIPS Act funding would be renegotiated to encourage the recipient firms to invest more in US manufacturing themselves, saying that taxpayers were not getting good value for their money.
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All of this makes for an interesting time for Intel, which saw Trump recently [20]call for the immediate resignation of chief executive Lip-Bu Tan over his alleged connections with the Chinese government, only for the president to change his tune after a [21]face-to-face meeting with Tan at the White House.
The Lip-Bu Tan controversy followed [22]more losses for the chip giant during the second quarter of this year, as the company strives to turn its fortunes around. But this hasn't deterred Japanese investment biz [23]SoftBank from sinking $2 billion into the Silicon Valley stalwart this week, framing it as a vote of confidence in Intel's ability to recover from its woes. ®
Get our [24]Tech Resources
[1] https://www.theregister.com/2024/11/26/intel_chips_act_funding/
[2] https://pubads.g.doubleclick.net/gampad/jump?co=1&iu=/6978/reg_onprem/publicsector&sz=300x50%7C300x100%7C300x250%7C300x251%7C300x252%7C300x600%7C300x601&tile=2&c=2aKXxGRQsUo37S8glt1u5YAAAAM8&t=ct%3Dns%26unitnum%3D2%26raptor%3Dcondor%26pos%3Dtop%26test%3D0
[3] https://www.cnbc.com/2025/08/19/lutnick-intel-stock-chips-trump.html
[4] https://pubads.g.doubleclick.net/gampad/jump?co=1&iu=/6978/reg_onprem/publicsector&sz=300x50%7C300x100%7C300x250%7C300x251%7C300x252%7C300x600%7C300x601&tile=4&c=44aKXxGRQsUo37S8glt1u5YAAAAM8&t=ct%3Dns%26unitnum%3D4%26raptor%3Dfalcon%26pos%3Dmid%26test%3D0
[5] https://pubads.g.doubleclick.net/gampad/jump?co=1&iu=/6978/reg_onprem/publicsector&sz=300x50%7C300x100%7C300x250%7C300x251%7C300x252%7C300x600%7C300x601&tile=3&c=33aKXxGRQsUo37S8glt1u5YAAAAM8&t=ct%3Dns%26unitnum%3D3%26raptor%3Deagle%26pos%3Dmid%26test%3D0
[6] https://www.theregister.com/2024/12/11/micron_chips_funded/
[7] https://www.theregister.com/2024/04/08/tsmc_116b_arizona_funding/
[8] https://www.theregister.com/2024/04/15/samsung_snags_64b_in_chips/
[9] https://www.theregister.com/2024/11/21/globalfoundries_chips_act/
[10] https://pubads.g.doubleclick.net/gampad/jump?co=1&iu=/6978/reg_onprem/publicsector&sz=300x50%7C300x100%7C300x250%7C300x251%7C300x252%7C300x600%7C300x601&tile=4&c=44aKXxGRQsUo37S8glt1u5YAAAAM8&t=ct%3Dns%26unitnum%3D4%26raptor%3Dfalcon%26pos%3Dmid%26test%3D0
[11] https://www.reuters.com/legal/government/trump-eyes-us-government-stakes-other-chip-makers-that-received-chips-act-funds-2025-08-19/
[12] https://www.theregister.com/2025/08/20/intel_website_flaws/
[13] https://www.theregister.com/2025/08/20/aws_custom_xeons_r8_instances/
[14] https://www.theregister.com/2025/08/19/softbank_intel_investment/
[15] https://www.theregister.com/2025/08/12/trump_intel_meeting/
[16] https://www.theregister.com/2025/03/05/trump_speech_scrap_chips_act/
[17] https://www.theregister.com/2024/11/04/chips_act_repeal/
[18] https://www.theregister.com/2025/06/05/trump_chips_act/
[19] https://pubads.g.doubleclick.net/gampad/jump?co=1&iu=/6978/reg_onprem/publicsector&sz=300x50%7C300x100%7C300x250%7C300x251%7C300x252%7C300x600%7C300x601&tile=3&c=33aKXxGRQsUo37S8glt1u5YAAAAM8&t=ct%3Dns%26unitnum%3D3%26raptor%3Deagle%26pos%3Dmid%26test%3D0
[20] https://www.theregister.com/2025/08/07/republican_senator_queries_intel_over/
[21] https://www.theregister.com/2025/08/12/trump_intel_meeting/
[22] https://www.theregister.com/2025/07/25/intel_european_retreat/
[23] https://www.theregister.com/2025/08/19/softbank_intel_investment/
[24] https://whitepapers.theregister.com/
Oh Dear....
From the article :
"...using taxpayers' money to acquire a stake in private businesses, and has been likened by some observers to communism."
How will the MAGA faithful cope with this, the sheer hypocrisy of their cult leaders behaviour.
Will their brains explode (assuming they have them) ?.
And yet, i have always thought that if the government (UK) was giving money to private companies (car,steel etc), then at least we should have a share in the company to obtain a return on investment.
Banks and investors don't give away free money, so why should the UK population be forced to do so through grants (UK).
Re: Oh Dear....
"...using taxpayers' money to acquire a stake in private businesses, and has been likened by some observers to communism."
That's not how communism works. The communist way would be to nationalise the business, without compensating private parties in any way whatsoever.
Re: Oh Dear....
That's theft, not communism.
Re: Oh Dear....
No, it's Socialism. Something Trump and his MAGAfans use as an insult on a regular basis and I very much expect heads to explode once it's explained to them that no, it's not a "business deal" when the Government buys into a private business. By definition, if the Government owns or party owns a business, then it's "nationalised" or "part-nationalised" because now the Govt. has a say in how it's run at the board level, not just by regulations and taxes. Depending on the business, even a 5% share could get you seat on the board.
Seems fair enough to me
If a company receives investment, ensuring a return for the investor is completely reasonable.
In fact, I'd go as far as to say that dishing out taxpayer money to companies without ensuring that the taxpayer gets a return on their investment should be grounds for legal action against the state for using taxpayer funds in an irresponsible manner.
Re: Seems fair enough to me
That can be a grey area. The ROI might be pulling them through a bad patch, keeping employees in a job, not to mention all the ancillary jobs that can be lost if a company goes under and all that extra expense that a local or State Govt might incur if a big employer goes under or leaves the area.
Of course, the opposite is true and $big_Corp will effectively "blackmail" their way to funding by threatening to close up shop and move out.
It's far more nuanced than handing over cash as a grant versus buying stock in the company or even favourable loans.
Re: Seems fair enough to me
I dunno, I like that they are at least talking about the taxpayer getting something back for it.
Unlike the automaker bailout which cost the taxpayer $9 billion.
Though it also looks like a civvie version of the military-industrial complex thing Eisenhower was going on about.
Hostile to Business
At this point who would want to do business in the USA?
Between ever changing import tarrifs, government racketeering (15% revenue cut for export licenses, $1 million dinners, gold plated Apples, etc), attempted intervention in management structures and now the forced partial nationalisation of private companies the USA is a hostile environment for business.
Re: Hostile to Business
Yes, this "export tariff" of Trumps has to be the icing on the cake. Funny how he railed against Canada putting export tariffs on goods in retaliation of the Trump Tariffs but when he does, it's a great idea.
Re: Hostile to Business
Export tariffs… explicitly forbidden by the Constitution. Not that that bothers the MAGAts.
Not Unprecedented
It will be recalled that as recently as 2009, the US government acquired a modest equity stake in General Motors as part of the bailout of GM and Chrysler. It later sold that stake. FWIW, the government lost a bit of money on the deal. $11.2B according to Google.
Re: Not Unprecedented
Which the fucking Republicans have been raging against ever since.
Sounds like socialism to me.
State owned???
That would be, let me check, *SOCIALISM*
Welcome to the civilised world 'murrica
I had to deal with decades of republicans yelling about how we need to respect the "free market" constantly as they rallied against any subsidies, regulations or whatever. (Except for fossil fuels and corn, but ignore that) As always, the hypocrisy is on full display but I am sure no one will break ranks.
With regards to Intel in particular, if I was a foreign county, viewing the increasingly unstable America as a potential security threat, how would I feel about their government buying a stake in a hardware company we use in our secure systems? I feel like being seen as a US state venture could hurt Intel internationally. If people have a reason to block Huawei hardware, why not Intel?
A bargain
Intel has a market cap of $125b so a $7bn 'investment' you would only be able to buy 5%.
But for the same money the government gets total control of the company and Intel no longer has to waste any of that cash actually building any fabs