Intel shares jump on possible US government investment

Irish Times

8 hours ago

Shares in
Intel
jumped more than 7 per cent on Thursday after reports that the Trump administration had discussed an unusual move to acquire an ownership stake as part of a plan to revive the troubled US chipmaker.
The proposal emerged after President
Donald Trump
met Intel's chief executive
Lip-Bu Tan
earlier this week, according to one person familiar with the discussion, who cautioned that details were still being worked out and the talks could fall apart.
A possible US acquisition of a stake in a publicly traded company underscores the Trump administration's increasingly interventionist approach to corporate America.
The talks around Intel, which were first reported by Bloomberg, come after chips groups Nvidia and AMD struck a deal that would allow them to sell more advanced artificial intelligence chips in China in exchange for offering a share of the sales revenues to the government.
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Earlier this year, the administration also took a so-called golden share in US Steel as a condition to clearing its takeover by Japan's Nippon Steel, giving Washington veto power over critical decisions.
Intel declined to comment on the talks but said: 'Intel is deeply committed to supporting President Trump's efforts to strengthen US technology and manufacturing leadership. We look forward to continuing our work with the Trump administration.'
White House spokesman Kush Desai said 'discussion about hypothetical deals should be regarded as speculation unless officially announced by the administration'.
Mr Tan met Mr Trump alongside commerce secretary
Howard Lutnick
and treasury secretary
Scott Bessent
on Monday, after the president last week called on the CEO to resign.
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Mr Trump praised Mr Tan after the meeting and said his administration would hold talks to Intel and 'bring suggestions to me during the next week'.
Crucial to the decision to get involved with Intel was Mr Trump's desire to revive the company's factory in Ohio, the person said.
In 2022, Intel said the site could become the largest semiconductor facility in the world, but the timeline has repeatedly slipped. Mr Tan took over the top role in March from
Pat Gelsinger
, who had invested heavily in manufacturing and was ousted by Intel's board.
A capital injection from Washington could help restart momentum and ease pressure on a company already cutting costs and shedding jobs.
Intel's chip manufacturing business has incurred billions of dollars in losses as it struggles to compete with Taiwan's TSMC.
The company is undergoing a big restructuring internationally and there have been reports that it plans to cut up to 20 per cent of its global workforce.
The Irish operation has been notified of the need for 195 compulsory redundancies, just under 4 per cent of the 5,000 staff based mostly at the Lexilip plant in Co Kildare where it has operated for the past 32 years.
Last month, Mr Tan said the company was abandoning already-paused manufacturing projects in Germany and Poland and slowing construction in Ohio to address the losses.
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