Trump's Strategic Deal: U.S. Takes Stake in Intel
The U.S., under President Trump, has agreed to acquire a 10% stake in Intel. This intervention converts government grants into equity, securing $10 billion for Intel to expand its factories. The deal follows Trump's prior meeting with Intel's CEO, Lip-Bu Tan, amid concerns about Tan’s connections with Chinese firms.
In a significant move, President Donald Trump announced that the U.S. government will acquire a 10% stake in Intel as part of a strategic deal aimed at supporting the struggling chipmaker. This intervention will see government grants transformed into an equity share, providing Intel with around $10 billion to bolster its factory expansion in the U.S.
The deal involves the purchase of a 9.9% stake in Intel for $8.9 billion, at a per-share price below market value, funded by unpaid grants from the CHIPS Act. It follows a tumultuous period between Trump and Intel CEO Lip-Bu Tan, whom Trump had previously urged to resign over alleged ties to Chinese companies.
While the government's stake does not come with a seat on Intel's board, it includes voting rights on critical shareholder decisions. Analysts believe this federal backing could aid Intel's efforts to rejuvenate its foundry business, but sustaining competitiveness in the AI market and processor segments remains a challenge.
(With inputs from agencies.)
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