The Trump administration is in talks with Intel Corp. to have the US government take a stake in the beleaguered chipmaker, according to people familiar with the plan, in the latest sign of the White House’s willingness to blur the lines between state and industry.
A deal would help shore up Intel’s planned factory hub in Ohio, said the people, who asked not to be identified because the deliberations are private.
The company had once promised to turn that site into the world’s largest chipmaking facility, though it’s been repeatedly delayed. The size of the potential stake isn’t clear.
The talks come just a week after President Donald Trump had called for the ouster of Intel Chief Executive Officer Lip-Bu Tan, accusing him of being “highly conflicted” because of concerns about his earlier ties to China.
The plans stem from a meeting this week between Trump and Tan, the people said. While the details are still being sorted, the idea is for the US government to pay for the stake, one of the people said. Another cautioned that the plans remain fluid. The talks could still end without an agreement. Shares of Intel climbed as much as 8.9% on Thursday. The stock closed 7.4% higher at $23.86 in New York, giving the company a market value of about $104.4 billion. The shares continued rising as much as 4% further after the close of regular trading.
“Discussion about hypothetical deals should be regarded as speculation unless officially announced by the administration,” said White House spokesman Kush Desai.
Intel declined to comment on the discussions. In a statement, a representative said the company is “deeply committed to supporting President Trump’s efforts to strengthen US technology and manufacturing leadership.”
“We look forward to continuing our work with the Trump administration to advance these shared priorities, but we are not going to comment on rumors or speculation,” Intel said.
Direct Intervention
Any agreement would bolster Intel’s finances at a time when the company has been slashing spending and cutting jobs. It also suggests that Tan will remain at Intel’s helm.
It’s the latest direct intervention by Trump into a key industry. The administration reached an agreement to receive a 15% cut of certain semiconductor sales to China and took a so-called golden share in United States Steel Corp. as part of a deal to clear its sale to a Japanese rival.
The Intel idea also echoes the Defense Department’s unprecedented announcement last month that it will take a $400 million preferred equity stake in the little-known US rare-earth producer MP Materials Corp. — a deal that would make the Pentagon the company’s largest shareholder. That move turned conventional wisdom on its head among investors, analysts, industry executives and even longtime government officials in terms of how private industry has dealt with the government.
These home-run investment swings by the federal government also aren’t expected to be one-time deals, Bloomberg News has previously reported, with Trump and his administration adamant about boosting domestic champions in sectors it deems critical to combating China on national security grounds. Some deals by the administration are being potentially fashioned on the MP Materials blueprint, one of the people said. That means an equity investment, guaranteed purchases, loans and private financing — alongside government partnership. The view by many within the administration is that such levers give full confidence to investors that a project has the backing of the most creditworthy institution in the world, while also providing cover to taxpayers’ money.
Financial Woes
A chip industry pioneer, Intel has struggled in recent years, hurt by the loss of market share and its technological edge. Tan’s predecessor, Pat Gelsinger, touted the Ohio factory expansion as part of a comeback plan.
But Intel’s financial woes have imperiled the project. Earlier this year, the build-out was delayed until the 2030s, and the company said in July that it would further slow the Ohio plan. Since taking over in March, Tan has focused more on getting Intel’s financial house in order.
Intel was poised to be the biggest beneficiary of money from the 2022 Chips and Science Act, though that program is now in flux under Trump. Earlier this year, administration officials floated the idea of having chip-production powerhouse Taiwan Semiconductor Manufacturing Co.operate Intel’s factories as part of a joint venture. But TSMC CEO C. C. Wei has said that his company plans to remain focused on its own business.
Trump has won Ohio in all three of his presidential elections, and Republicans flipped a Senate seat there in 2024. Vice President JD Vance served as a senator from the state. Former Democratic Senator Sherrod Brown is seeking election there again next year, making the state something of a battleground once again, though it has trended steadily toward Republicans.
By Bloomberg
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