The United States government aims to take a capital participation in Intel, said Secretary of Commerce Howard Lutnick said Tuesday.
“We should obtain a capital participation for our money, so we will deliver the money that was already committed under the Biden administration,” Lutnick told CNBC. “We will obtain equity in return,” he added, and “get a good performance for the American taxpayer.”
Lutnick added that the United States government would not obtain a voting participation with the investment or rights to direct the company’s operations.
NBC has communicated with Intel to comment on Lutnick’s comments.
Intel has had problems keeping up with rival chips manufacturers Nvidia and AMD. Their actions, which have been up and down throughout the year, increased 11% on Tuesday when investors praised the news. In addition, on Monday, Japan Softbank announced that it would invest $ 2 billion in Intel to “deepen your commitment to invest in advanced technology and innovation of semiconductors in the United States.”
An investment of the United States government would be the last dramatic turn in the relationship of the administration with Intel. President Donald Trump has tried to revitalize the American manufacture of semiconductors threatening tariffs up to 100% in chips imports. But he also attacked Intel CEO, Lip-Bu Tan and demanded his resignation on alleged ties with China. “There is no other solution to this problem,” Trump said on August 7.
Days later, so and other senior executives visited Trump in the White House. The president said the meeting was “very interesting” while added that the “rise of so is an incredible story.”
Trump said so and the members of the cabinet “would spend time together and bring me suggestions during the next week.”
In a statement to NBC News after the meeting, Intel said he had a “constructive discussion about Intel’s commitment to strengthen technology and manufacturing leadership of the United States” with Trump. “The company added:” We appreciate the strong leadership of the president to advance these critical priorities and hope to work closely with him and his administration while we restored this great American company. “
Shortly after, Bloomberg News reported that the government was considering participating in the chips manufacturer.
“Instead of simply delivering subsidies” under the Chips Law, which was approved under the Biden administration, Lutnick said the president believes that the government “should obtain benefits for the economy we get.”
The investment would also be the last falsification between the Trump administration and a large corporation. At the beginning of this summer, Trump approved the acquisition of Us Steel by the Nippon Steel of Japan after the companies gave the government a “golden participation”, which allows him to appoint a member of the EE Steel Board. UU. And block a reduction in capital investments or workforce.
The Department of Defense also recently invested more than $ 400 million in MP materials from the rare land producer based in the United States.
The United States also recently approved export licenses for sales of some Nvidia and AMD chips in China after companies agreed to give the government a 15% reduction in their sales.
The United States has only taken a direct participation in a company in times of financial crisis, such as 92% owned by Finance and AIG insurance giants in 2008 or its assistance from more than $ 30 billion to General Motors after the company declared bankruptcy in 2009.
Speaking separately in CNBC on Tuesday morning, the secretary of the Treasury, Scott Besent, said that any conversion of the government subsidy into an investment in Intel would be “to help stabilize the company for the production of chips in the United States”
The law of Chips and Science, which the White House of President Joe Biden pressed to stimulate the manufacture of national semiconductors, reserved $ 39 billion in loans and tax benefits for the Department of Commerce to distribute. Intel was only one of several companies that expected to receive money under legislation.
Intel had received $ 10.9 billion in subsidies, including $ 7.9 billion to support their national investment plans and $ 3 billion more to manufacture microelectronics for the Department of Defense.
Lutnick did not declare exactly how much Intel the government investment would be equivalent, but did not go back against recent reports that said it would be about 10% of the company. The Commerce Department did not immediately respond to a request for comments.
Intel’s market value to Tuesday was approximately $ 115 billion.
