The U.S. officially took a 10% stake in beleaguered chipmaker Intel, Commerce Secretary Howard Lutnick said on Friday.
Lutnick announced the historic deal on X, writing, "BIG NEWS: The United States of America now owns 10% of Intel, one of our great American technology companies. This historic agreement strengthens U.S. leadership in semiconductors, which will both grow our economy and help secure America’s technological edge. Thanks to Intel CEO @LipBuTan1 for striking a deal that’s fair to Intel and fair to the American People."
The development follows a meeting between Tan and Trump earlier this month that was sparked by Trump's demand for the Intel chief's resignation over his ties to Chinese firms.
"He walked in wanting to keep his job and he ended up giving us $10 billion for the United States. So we picked up $10 billion," Trump said on Friday.
While Trump did not provide detail on the $10 billion, the equity stake is about equal to the amount Intel is set to receive in CHIPS Act grants from the government to help fund the building of chip plants in the U.S.
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The Pentagon is also slated to become the largest shareholder in a small mining company to boost output of rare earth magnets and the U.S. government negotiated for itself a "golden share" with certain veto rights as part of a deal to allow Nippon Steel to buy U.S. Steel.
The U.S. government's broad intervention in corporate matters has worried critics who say Trump's actions create new categories of corporate risk.
Semiconductors power everything from smartphones to defense systems, and Intel’s struggle is a national security concern, industry analysts say. A federal stake would signal a shift from traditional subsidies toward direct industrial policy, policy experts have noted.
Patrick Moorhead, founder of Moor Insights & Strategy, told FOX Business the administration’s approach fits with other recent moves.
"We’ve already seen an investment in MP Materials, and the administration has asked both Nvidia and AMD for a 15% cut of revenue from GPUs shipped to China," Moorhead said.
"Given the national security implications of having a domestic foundry and intellectual property to drive leading-edge chips, it would not surprise me if one of the options on the table is an investment in Intel. The administration could also follow through on semiconductor tariffs that would provide an even greater incentive for chip designers like Nvidia to do business with Intel."
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The deal arose despite Trump publicly calling for Tan’s resignation over his past business ties.
CBS News MoneyWatch reported that Sen. Tom Cotton, R-Ark., sent a letter to Intel’s board raising concerns about Tan’s investments in semiconductor firms reportedly linked to the Chinese Communist Party and the Chinese military.
"The CEO of INTEL is highly CONFLICTED and must resign, immediately. There is no other solution to this problem," the president wrote on his platform.
Ohio, home to Intel’s proposed factory, is politically central. Trump won the Buckeye State in all three of his presidential runs, and it’s the home state of Vice President JD Vance, election records show. With the 2026 Senate race heating up, this project carries heavy political weight, political observers say.
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Reuters contributed to this report.