U.S. Secretary of Commerce: Intel must exchange equity for government subsidies, implying that Taiwan Semiconductor and Samsung may follow suit

U.S. Secretary of Commerce Gina Raimondo made it clear on Tuesday that Intel (INTC.US) must hand over equity to the U.S. government in exchange for subsidies from the U.S. government's CHIPS Act, to secure the rightful returns for the American people.

The news drove Intel's stock price up 7% on Tuesday. Earlier reports indicated that the Trump administration was considering holding a 10% stake in Intel, which would make the U.S. government its largest shareholder if realized.

Raimondo emphasized that the government's potential equity would consist of non-voting shares and hinted that Trump might require other companies receiving funding from the CHIPS Act, such as Taiwan Semiconductor (TSM.US) and Samsung, to make similar arrangements.

Intel and SoftBank also announced on Monday that they had reached an agreement, with SoftBank investing $2 billion for approximately 2% equity in Intel, becoming the company's fifth-largest shareholder.

Intel previously received approval for $7.9 billion in government subsidies, while Taiwan Semiconductor received $6.6 billion to support the construction of its facility in Arizona, USA