Trump Administration’s Significant Intelligence Investment Leverages Existing Grants

On Friday afternoon, Intel officially announced an agreement with President Donald Trump’s administration, following Trump’s declaration that the government would take a 10% stake in the struggling chipmaker.

As per Intel, the government is set to make an “$8.9 billion investment in Intel common stock.” However, it seems that the administration is not releasing new funds but rather disbursing what Intel described as “grants previously awarded but not yet utilized by Intel.”

The $8.9 billion is anticipated to come from $5.7 billion that remains unspent under the Biden administration’s CHIPS Act, along with an additional $3.2 billion allocated through the Secure Enclave program, which was also launched by the Biden administration.

Trump shared on his social media platform Truth Social that “The United States paid nothing for these shares.” Nevertheless, he hailed this as “a great Deal for America and, also, a great Deal for INTEL.”

Previously, the former president criticized the CHIPS Act, labeling it a “horrible, horrible thing” and urged House Speaker Mike Johnson to “eliminate” it. In a regulatory filing from June, Intel indicated it had received $2.2 billion from CHIPS Act funding but had submitted a request for an additional $850 million in reimbursement, which the government has yet to fulfill.

The New York Times has indicated that some bankers and legal advisors are doubtful whether the CHIPS Act allows the government to convert its grants into equity, potentially opening the deal to legal challenges.

In addition to his critique of the CHIPS Act, Trump also accused Intel CEO Lip-Bu Tan of having conflicts of interest earlier this month, suggesting he should “resign immediately.” However, on Friday, Trump adopted a more positive stance, stating on Truth Social that he “negotiated this deal with Lip-Bu Tan, the Highly Respected Chief Executive Officer of the Company.”

Tan expressed his appreciation in a statement, saying, “We are grateful for the confidence that the President and the Administration have shown in Intel, and we look forward to working together to enhance U.S. technology and manufacturing leadership.”

Intel also clarified that the government’s investment will be “passive,” meaning there will be no representation on the board or associated governance and information rights.