The U.S. government’s acquisition of a 9.9% equity stake in Intel, valued at $11.1 billion through CHIPS Act funding, announced on August 15, 2025, has raised investor concerns about government interference in private industry. The deal, following President Trump’s call for Intel CEO Lip-Bu Tan’s resignation, is seen as a potential precedent for political pressure on corporations. Investors, including shareholder activist James McRitchie, fear it signals coercive tactics, diluting shareholder voting rights and risking additional regulations, as noted in Intel’s securities filing. The Commerce Department, while lacking board seats, retains voting flexibility on certain issues.
Intel’s stock rose from $20.41 on August 6 to $24.56 on August 15 but fell 1% to $24.35 post-announcement. Fitch Ratings noted the deal adds liquidity but does not improve Intel’s BBB credit rating or address weak chip demand. Despite a $2 billion SoftBank investment days prior, Tan claimed the funds were unnecessary. The move follows other Trump administration interventions, like stakes in a mining company and influence over U.S. Steel’s sale. While government stakes are common in Europe and Asia (e.g., Germany’s 20% in Volkswagen), this long-term involvement in a healthy U.S. firm is unprecedented, raising fears of state capitalism.
Investors, including Rich Weiss of American Century Investments, warn of risks like insider trading without clear regulations. Robert McCormick of the Council of Institutional Investors highlighted potential conflicts between corporate and national interests. Kristin Hull of Nia Impact Capital expressed concerns about blurred lines between government and private sectors. While some see the deal as a shield against activist investors, broader adoption could signal a troubling trend, prompting scrutiny of why capital markets are not meeting financing needs.
