US government takes ~9.9% stake in Intel; CHIPS Act requirements waived
Summary: The U.S. government has converted $5.7 billion of previously earmarked CHIPS Act funds into Intel common stock, resulting in roughly a 9.9% equity stake. In connection with that action, most CHIPS Act milestone and cash‑flow sharing requirements tied to those funds have been waived. The government’s total involvement in Intel now stands at about $11.1 billion when including earlier grants and program awards.
Key facts
- Stake & funds: ~$5.7B converted into equity (~9.9% stake). Total government involvement ≈ $11.1B (includes other awards).
- Milestones waived: Intel is no longer required to meet certain CHIPS Act project milestones or share a portion of cumulative cash flow from projects with the Commerce Department.
- Remaining restrictions: Funds cannot be used for dividends or share repurchases. Some CHIPS Act workflow and workforce policy requirements have also been relaxed.
- Intel spending: Intel reported it has already spent about $7.9B on eligible CHIPS Act projects (Reuters noted $7.87B).
- Other details: Reports reference a possible 5-year warrant for an additional 5% equity under certain conditions and note the government’s stake is passive with no board seats.
Context
The deal came after discussions between Intel leadership and the administration. President Donald Trump commented on the outcome, indicating the conversion and investment as a key result of meetings with Intel’s CEO. Intel also recently received a government payment of $5.7B and had previously been awarded $2.2B in CHIPS Act grants.
Sources
Primary public coverage: Morningstar / Dow Jones
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