US Government Investment May Boost Intel's Stock Prices
In a historic move, the U.S. government has announced its intention to purchase a 9.9% ownership stake in Intel, the world-renowned semiconductor company. The deal, worth approximately $8.9 billion, includes the purchase of 433.3 million shares at $20.47 per share.
This interventionist approach by the Trump administration marks a significant shift in corporate America, reflecting the administration's objectives of bolstering U.S. leadership in technology and semiconductor manufacturing, as outlined in the CHIPS and Science Act.
The agreement, announced on August 23, 2025, follows discussions between President Trump and Intel CEO Lip-Bu Tan. It is worth noting that Tan was previously urged by Trump to resign due to perceived conflicts of interest.
The government's ownership will be passive, with no board representation or governance rights, agreeing to vote alongside the company's board with limited exceptions. This move is intended to maintain Intel’s independence.
For Intel, the capital infusion from this deal removes previous claw-back and profit-sharing provisions, enabling more permanent capital as Intel advances its U.S. investment plans. The investment also came at a price discounted from the then-current market price, benefiting taxpayers and aligning incentives for Intel’s long-term business success.
The deal is designed to strengthen Intel’s position in the competitive semiconductor industry, reinforce U.S. technological leadership, and provide the company with stable capital to support its restructuring and manufacturing goals.
It's important to note that Intel is currently undergoing a significant restructuring, potentially cutting up to 20% of its global workforce. The company's chip manufacturing business has incurred billions of dollars in losses, and it has paused manufacturing projects in Germany and Poland, and slowed construction in Ohio.
The administration's potential investment in Intel could help restart momentum and ease pressure on the company. Intel has expressed support for President Trump's efforts to strengthen US technology and manufacturing leadership, but declined to comment on the talks.
The talks around Intel were first reported by Bloomberg, and the meeting between Trump and Tan was crucial for potential discussions about Intel. Howard Lutnick and Scott Bessent were also present during this meeting.
The administration's intervention extends beyond Intel, as it also took a so-called golden share in US Steel as a condition to clearing its takeover by Japan’s Nippon Steel.
In other news, Intel's factory in Ohio, which could become the largest semiconductor facility in the world, is a key focus for Trump's intervention. The Irish operation of Intel has notified 195 compulsory redundancies, approximately 4% of its staff in Co Kildare.
Shares in Intel increased more than 7% on Thursday due to reports of discussions about the Trump administration acquiring an ownership stake in the company. However, the White House spokesman, Kush Desai, stated that discussions about hypothetical deals should be regarded as speculation unless officially announced by the administration.
[1] Bloomberg News, "U.S. to Buy 9.9% Stake in Intel for $8.9 Billion," August 23, 2025.
[2] The New York Times, "Trump Urges Intel CEO to Resign," August 16, 2025.
[3] Reuters, "Intel and the U.S. Government Agree to Historic Deal," August 23, 2025.
- The decision by the Trump administration to purchase a stake in Intel, a leading business in the technology sector, reflects their intent to support and bolster U.S. technology, particularly in the semiconductor industry.
- The strategic investment in Intel will provide the company with stable capital to execute its restructuring plans and reinforce American technological leadership, while also ensuring the company's independence in its business decisions.
