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“The government paid nothing for these shares..”
The $8.9 billion investment is in addition to the $2.2 billion in CHIPS grants Intel has received to date, making for a total investment of $11.1 billion.
U.S. government takes 10% stake in Intel
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Re: U.S. government takes 10% stake in Intel
#62I despite/abhor this administration and their politics, but this is a good move. There should be more privatization where national interests are involved. Instead of the ACA for example,the government could have taken a 51% stake in health insurers (forget subsidizing them, own them!) and we the voters would elect politicians to oversee health insurance instead of hoping and trusting CEOs. So many problems are caused…
I swear Im not trying to be glib or dismissive, but I honestly think you dont know what "privatization" means, this is the exact opposite.
Re: U.S. government takes 10% stake in Intel
#63Genuine question- How does Govt picking winners and losers going to help? Intel is no Too big to fail Bank. Why save Intel of all chip manufacturers? Wouldnt it be like 25 years too late, with Intel and its heydays !? Would Govt now ensure parity by investing in "marquee" entities across different industrial domains?
You are asking why save Intel of all chip manufacturers, and the answer is because there aren't any other major chip manufacturers in the US.
AMD no longer has a fab. TSMC dominates the global market and basically has no competition.
In the event that Taiwan is invaded, the US would suddenly have a huge problem getting access to any kind of high end chips, be they CPUs or GPUs. This would be a major problem economically and militarily for the US.
Some caveats: Due to the chip act, TSMC does now have fabs Arizona, though I'm not sure what their capacity is. TI, and some others building lower end components also have fabs I believe. For x86, high end ARM, and GPU's, virtually all of that is manufactured by TSMC right now, mostly in Taiwan.
Re: U.S. government takes 10% stake in Intel
#64[flagged]
Don’t post LLM junk on HN — it’s not just annoying, it erodes the community trust.
Re: U.S. government takes 10% stake in Intel
#65Genuine question- How does Govt picking winners and losers going to help? Intel is no Too big to fail Bank. Why save Intel of all chip manufacturers? Wouldnt it be like 25 years too late, with Intel and its heydays !? Would Govt now ensure parity by investing in "marquee" entities across different industrial domains?
This government? Bribe them on the side.
Re: U.S. government takes 10% stake in Intel
#66Genuine question- How does Govt picking winners and losers going to help? Intel is no Too big to fail Bank. Why save Intel of all chip manufacturers? Wouldnt it be like 25 years too late, with Intel and its heydays !? Would Govt now ensure parity by investing in "marquee" entities across different industrial domains?
There is only 1 winner and 1 loser: Intel.
It's the only chip manufacturer "left" in the US. The argument is national security: the US expects China to invade Taiwan and this will kill TSMC in the process.
Whether this will happen or not can be debated, but this is what the government expects.
Re: U.S. government takes 10% stake in Intel
#67Re: U.S. government takes 10% stake in Intel
#68Earlier quoted context omitted.
I don't expect a good reason given the history of this Administration, but a reason in my mind to save Intel is there's only 3 license holders for x86 CPUs. Intel, AMD (American), and VIA (Taiwanese). A dead Intel leaves a single American company that is able to make x86 processors, and a monopoly for actually good x86 CPUs. But somehow I suspect there's no logical reason for this besides lining the pockets of those…
What about Hygon?
I haven't heard of them until this comment, but reading through Wikipedia, and a techpowerup article, I'm not seeing that they actually own a license to manufacture x86 cpus freely. It seems like they were able to due to it being a partnership with AMD. I could easily be wrong though.
Re: U.S. government takes 10% stake in Intel
#69> the government made an $8.9 billion investment in Intel common stock, purchasing 433.3 million shares at a price of $20.47 per share, giving it a 10% stake in the company > The United States paid nothing for these Shares, and the Shares are now valued at approximately $11 Billion Dollars I don't understand. Can somebody explain to me how the government made an investement, bought shares, but paid nothing?
I think a better rephrasing is "government is giving $8.9B from the CHIPS act in exchange for a 10% stake in the company"
Depends on who you ask. Trump himself seems to think the US is getting 10% for free. I think that's a fair assessment given that these grants were already supposed to be paid out to Intel, without any kind of equity stake promised.
Worth noting that Intel is the only company that had these kinds of shenanigans pulled with their grant. Samsung, TSMC, Micron and others were granted similar funds without any kind of withholding or demands for equity from the federal government.
Re: U.S. government takes 10% stake in Intel
#70> the government made an $8.9 billion investment in Intel common stock, purchasing 433.3 million shares at a price of $20.47 per share, giving it a 10% stake in the company > The United States paid nothing for these Shares, and the Shares are now valued at approximately $11 Billion Dollars I don't understand. Can somebody explain to me how the government made an investement, bought shares, but paid nothing?
The answer is in the paragraph in between the two you quoted from. The money for the purchase has already been appropriated by Congress and awarded to Intel. The awards didn't previously have this giant string attached where Intel gives stock in return. But now they do.
And it makes sense that Intel is spinning it as a generous investment from the gov't, but the gov't is spinning it as a free gift from Intel. Neither account really paints the full picture, but each one paints themselves as coming out ahead.