U.S. Government Eyes Equity Stakes in Intel and Chip Companies Under CHIPS Act

The U.S. government, spearheaded by Commerce Secretary Howard Lutnick, is contemplating taking equity stakes in technology firm Intel, along with other chip companies, in return for grants under the CHIPS Act. This initiative is part of a broader strategy to rejuvenate American manufacturing, aligning with former President Donald Trump's economic goals.

In a significant expansion of this plan, Lutnick aims to involve several companies, a decision that parallels past deals under the Trump administration, such as the agreement allowing Nvidia to sell chips to China. Critics have expressed concern about the potential risks these deals pose to taxpayer funds.

The CHIPS Act, managed by the Commerce Department, involves $52.7 billion in funding, much of which remains undistributed. Lutnick's approach, seeking non-voting government stakes, contrasts with past administrations' practices and introduces a new level of financial engagement, hoping for a return on investment and greater national security.

(With inputs from agencies.)