Commerce Secretary Lutnick says Intel needs to give government stake for CHIPS funding

Commerce Secretary Howard Lutnick on Tuesday confirmed that the government wants Intel to cough up a 10% equity stake in exchange for nearly $8 billion in CHIPS Act funding approved by the Biden administration.Lutnick said the the stake would be a return on its “investment” in the struggling chipmaker.“We should get an equity stake for our money,” Lutnick told CNBC’s “Squawk on the Street.” “So we’ll deliver the money, which was already committed under the Biden administration.

We’ll get equity in return for it.”The government does not want control of the company, he added.Lutnick’s comments came on the heels of a report Monday that President Trump was seeking a 10% stake in the company.“The president wants to put America’s needs first, both from a national security and economic perspective, and it’s a creative idea that has never been done before,” White House Press Secretary Karoline Leavitt said Tuesday in confirming that Lutnick was working on a deal.Intel declined to comment.Sign up to receive On The Money by Charlie Gasparino in your inbox every Thursday.

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Never miss a story.Shares of Intel jumped 7% on the prospect of the government bailing out the chipmaker.“The stake would be a conversion of the grants and maybe increase the investment into Intel to help stabilize the company for chip production here,” Treasury Secretary Scott Bessent told CNBC.On Monday, Japanese firm SoftBank announced it would invest $2 billion in Intel, making it the fifth-largest shareholder, according to FactSet.Intel was awarded $8.5 billion in CHIPS Act funding under the Secure Enclave program, a national security initiative to make microchips for defense and intelligence applications.It was later slashed by more than $600 million to about $7.85 billion, but Intel still tops the list as on...