Lutnick says Intel has to give government equity in return for CHIPS Act funds

Commerce Secretary Howard Lutnick: Intel has to give gov. equity in return for CHIPS fundingSquawk on the StreetCommerce Secretary Howard Lutnick said Tuesday that Intel must give the U.S. government an equity stake in the company in return for CHIPS Act funds."We should get an equity stake for our money," Lutnick said on CNBC's "Squawk on the Street." "So we'll der the money, which was already committed under the Biden administration

We'll get equity in return for it."s of the struggling chipmaker climbed nearly 7% on Tuesday, continuing to rally on recent reports that the Trump administration is weighing different ways to get involved with the company.Bloomberg reported Monday that the White House was discussing a 10% stake in Intel, in a deal that could see the U.S. government become the chipmaker's largest holder.Intel and SoftBank announced Monday that the Japanese conglomerate will make a $2 billion investment in the chipmaker

The investment, equal to 2% of Intel, makes SoftBank the fifth-biggest holder, according to FactSet.Read more CNBC newsSilicon Valley's AI deals are creating zombie startups: 'You hollowed out the organization'OpenAI launches cheapest ChatGPT plan at $4.6, starting in IndiaAnalysts downplay AI bubble worries as Altman says some investors will be left 'very burnt'Intel is getting a $2 billion investment from SoftBankLutnick said any potential arrangement wouldn't vide the government with voting or governance rights in Intel."It's not governance, we're just converting what was a grant under Biden into equity for the Trump administration, for the American people," Lutnick said. "Nonvoting."Intel declined to .Lutnick also suggested that President Donald Trump could seek out similar deals with other CHIPS recipients.Intel said last fall that it had finalized a nearly $8 billion grant from the law to build its factories

Taiwan Semiconductor Manufacturing Co. was awarded $6.6 billion under the legislation to boost chip fabrication at its Arizona facilities.US President Joe Biden, second left, tours the site of the new Intel semiconductor manufacturing facility near New Albany, Ohio, US, on Friday, Sept. 9, 2022.Gaelen Morse | Bloomberg | Getty Images'Silicon Heartland'Trump has called for more reshoring of U.S. manufacturing to reduce the country's reliance on companies Samsung and TSMC to manufacture chips.Intel has been spending billions near Columbus, Ohio, to build a series of chip factories that the company previously called the "Silicon Heartland." Intel has said that the factory complex would be able to duce the most advanced chips, including AI chips.But in July, Intel CEO Lip-Bu Tan said in a memo to employees that there would be "no more blank checks," and that it was slowing down the construction of its Ohio factory complex, depending on market conditions.The first factory is now scheduled to start operations in 2030.The Ohio factory was one of the most public jects funded by the CHIPS and Science Act, which became law in 2022

The law committed the U.S. government to fund chip re and development and was estimated to cost $53 billion."The Biden administration literally was giving Intel for free, and giving TSMC money for free, and all these companies just giving them money for free," Lutnick said. "Donald Trump turns that into saying, 'Hey, we want equity for the money

If we're going to give you the money, we want a piece of the action.' "Intel has struggled to capitalize on the artificial intelligence boom in advanced semiconductors and has spent heavily to stand up a manufacturing that's yet to secure a significant customer

Intel tapped Lip-Bu Tan to be its CEO in March after his predecessor, Pat Gelsinger, was ousted in December.Tan met with Trump at the White House last week after the president called for his resignation, alleging he had ties to China.Stock Chart IconStock chart iconIntel 5-day stock chart.— CNBC's Kif Leswing contributed to this report.Don’t miss these insights from CNBC Forget Palantir