Technology

Washington buys into Intel with billion-dollar investment

U.S. government invests $8.9 billion in Intel and enhances industrial policy control over semiconductor production.

Eulerpool News Aug 25, 2025, 6:08 PM

The US government acquires a nearly 10 percent stake in the chip company Intel for $8.9 billion.

Intel announced late Friday that the shares would be acquired at $20.47 each, significantly below the closing price of $24.80. Additionally, the government receives a five-year warrant right for an additional 5 percent at $20 per share – but only if Intel should cede the majority in its foundry division. This division produces chips on behalf of other companies and is considered a problem child with billions in losses.

Group CEO Lip-Bu Tan reaffirmed his intention to stick with the business, even though he might scale back involvement in the most advanced manufacturing stages if Intel does not secure major customers soon. It was only days ago that it became known that Tan had held talks with SoftBank founder Masayoshi Son about a possible sale of the foundry business. Meanwhile, SoftBank announced its intention to purchase $2 billion worth of Intel shares itself.

The agreement simultaneously relieves Intel in meeting the subsidy criteria of the Chips Act, after the company recently slowed down the construction of several plants – including the megaproject in Ohio. Whether the originally promised $10.9 billion in subsidies will be fully disbursed is unclear. In 2024, Intel reported an operating loss of $13 billion in the chip business.

The announcement was positively received on the stock exchanges: The Intel stock rose by 5.5 percent on Friday. President Donald Trump called the entry a "great deal for America," accompanied by the message that key technologies such as cutting-edge semiconductors would need to be produced in the USA in the future.

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