Intel must give government equity in exchange for CHIPS Act funds: US commerce chief

ISTANBUL

The US commerce secretary said Tuesday that Intel has to give an equity stake to the US government in exchange for the funds it has received under the 2022 legislation known as the CHIPS Act.

“We should get an equity stake for our money,” Howard Lutnick told financial network CNBC. “We’ll deliver the money, which was already committed under the (previous Joe) Biden administration. We’ll get equity in return for it.”

Such an agreement, according to Lutnick, would not grant the government control or voting powers with the chip producer.

“It’s not governance, we’re just converting what was a grant under Biden into equity for the Trump administration, for the American people,” he said, referring to how the CHIPS Act was passed by the US Congress under then-President Biden.

Lutnick also emphasized that President Donald Trump could look for similar agreements with other CHIPS funds recipients.

Last year, Intel said that it had completed an $8 billion legal grant to construct its plants. Also under the law, Taiwanese firm TSMC received a $6.6 billion grant to expand chip production at its facilities in the state of Arizona.

Bloomberg reported Monday that the US is in talks with Intel to acquire a 10% stake in the company – an unusual move that could make the administration the single largest shareholder in the company.

Also Tuesday, Japan's SoftBank said it has signed a $2 billion investment agreement with Intel.

"The investment comes as both Intel and SoftBank deepen their commitment to investing in advanced technology and semiconductor innovation in the United States," the companies said in a statement.