President Trump said Friday that Intel has agreed to give the U.S. government a 10 percent stake in the company.
“They’ve agreed to do it, and I think it’s a great deal for them,” Trump told reporters.
The administration has been weighing taking a stake in the struggling American chipmaker, pulling from previously allocated funding, Commerce Secretary Howard Lutnick confirmed earlier this week.
Trump offered some details Friday on how the agreement came about after he initially called on Intel CEO Lip-Bu Tan to resign earlier this month.
He pointed to concerns raised by Sen. Tom Cotton (R-Ark.) about Tan’s investments in Chinese companies and his previous role as CEO of Cadence Design Systems, which recently pleaded guilty to violating export controls by selling chip design technology to a Chinese military university.
“I said, ‘Well that’s right he should resign,’” Trump said. “And he came in, he saw me, we talked for a while. I liked him a lot. I thought he was very good. I thought he was somewhat a victim, but, you know, nobody’s a total victim, I guess.”
“And I said, ‘You know what? I think the United States should be given 10 percent of Intel.’ And he said, ‘I would consider that,’” the president continued. “Intel has been left behind, as you know, compared to [Nvidia CEO] Jensen [Huang] and some of our friends.”
Lutnick suggested Tuesday that part of the rationale for taking a stake in the company is to potentially move some chip production back to the U.S.
“We cannot rely on Taiwan, which is 9,500 miles away from us and only 80 miles from China,” he told CNBC’s “Squawk Box.” “So, you can’t have 99 percent of leading-edge chips made in Taiwan. We want to make them here.”
“One of those pieces is it would be lovely to have Intel be capable of making a U.S. node or a U.S. transistor, driving that in America,” he added.
The Commerce Secretary also said Trump believes “America should get the benefit of the bargain” from this funding. Reports have indicated that the administration plans to pull from CHIPS and Science Act grants.
This proposal has gained a surprising supporter — Sen. Bernie Sanders (I-Vt.) He suggested it aligned with an earlier effort to secure returns from CHIPS and Science Act investments.
“No. Taxpayers should not be providing billions of dollars in corporate welfare to large, profitable corporations like Intel without getting anything in return,” he said in a statement.
“If microchip companies make a profit from the generous grants they receive from the federal government, the taxpayers of America have a right to a reasonable return on that investment,” Sanders added.
Meanwhile, Sen. Rand Paul (R-Ky.) slammed the push to acquire a stake in the chipmaker as a “terrible idea” and a “step toward socialism.”
“If socialism is government owning the means of production, wouldn’t the government owning part of Intel be a step toward socialism?” Paul wrote Wednesday on X.
Updated at 3:20 p.m. EDT
