Intel shares rose about 6% on Friday as the Trump administration prepared to announce that the U.S. government would take a stake in the troubled chipmaker. After the report was released, President Trump said the government should take about 10% of the company, which has a market value of just over $100 billion.
"They've agreed to do this and I think it's a great deal for them," Trump told reporters at the White House on Friday.
A White House official said there would be "ongoing discussions" with Intel, adding that nothing had been decided yet and that Intel's CEO had not explicitly agreed to a deal. President Trump and Chen will meet later this afternoon.
An Intel representative declined to comment.
The move would mark the latest example of a clear shift in U.S. industrial policy, with the government taking an active role in corporate America. Commerce Secretary Lutnick said this week that the U.S. government is seeking to acquire an equity stake in Intel in exchange for funds provided by the CHIP Act.
"We're supposed to get equity with our money," Lutnick said. "So we're going to provide that money, which is what the Biden administration has committed to. And in return, we're going to get equity."
Lutnick said the government's shares would be "non-voting."
Earlier this week, Intel announced another major backer, with SoftBank saying it would invest $2 billion in the chipmaker, equivalent to about a 2% stake in the company.
Intel is the only U.S. company capable of manufacturing the most advanced chips here, although its technology is considered to lag behind that of TSMC
The company makes chips for companies like Apple, Nvidia, Qualcomm, AMD and even Intel.
Intel has been spending billions of dollars to build a series of chip factories in Ohio, an area the company has called the "Silicon Heartland," where it will be able to produce the most advanced chips, including those for artificial intelligence.
But in July this year, company CEO Chen Liwu said in a memo to employees that there would be "no more blank checks" and that the construction of the Ohio factory complex would be slowed down based on market conditions. Intel's Ohio factory is currently scheduled to begin operations in 2030.
Intel said last fall that it had finalized a nearly $8 billion grant under the CHIPS and Science Act to fund its factory-building plans. The bill was passed in 2022 under the Biden administration.