President Trump Announces Plans for U.S. Government to Take 10% Stake in Intel, Marking a Potential Shift in Private Company Ownership
The United States government is set to acquire a 10% equity stake in Intel, according to recent reports. This development, which sent Intel’s stock soaring by over 7%, was first broken by financial news outlet Bloomberg.
President Donald Trump confirmed the proposal during a press briefing, stating that Intel has agreed to the terms. However, Intel declined to comment on the matter.
This move comes at a critical juncture for Intel, with CEO Lip-Bu Tan currently spearheading a restructuring initiative aimed at streamlining operations and refocusing efforts on core businesses. The company is looking to trim certain divisions and cut workforce as part of this overhaul, with the ultimate goal of catching up to competitors such as Nvidia.
Recent tensions between Trump and Tan escalated earlier this month, when Trump called for Tan’s resignation due to perceived conflicts of interest. However, a subsequent meeting between the two resulted in efforts to find common ground and explore collaboration opportunities.
During his press briefing, Trump acknowledged the tension but expressed his appreciation for Tan, stating that he found him to be competent and capable. He further proposed that a 10% ownership stake by the U.S. government would benefit both parties, suggesting it as a potential solution to Intel’s perceived lag behind competitors like Nvidia.
“I think it would be good having the United States as your partner,” Trump said, according to emailed comments from the press pool. “He agreed. And they’ve agreed to do it and I think it’s a great deal for them and I think it’s a great deal.”
Such government ownership of a major corporation represents a significant departure from established U.S. policy. While rare, there have been instances where the government has taken equity stakes in private companies during times of crisis, such as during the 2008-2009 financial crisis when the government temporarily owned stakes in companies like General Motors, AIG, and several major banks to prevent economic collapse. These stakes were subsequently sold back to private investors over subsequent years.
The Intel deal, expected to be announced later today, follows closely on the heels of a $2 billion investment agreement between Intel and Japanese conglomerate SoftBank. Under this agreement, SoftBank agreed to purchase Intel common stock at $23 per share. As of Friday afternoon, Intel shares were trading around $25.
An official comment from the White House regarding the Intel-government partnership is pending.
