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Investing.com -- Intel (NASDAQ:INTC) stock declined 5% following a Bloomberg report that the Trump administration is discussing taking a stake of approximately 10% in the chipmaker.
According to the report, the federal government is considering converting some or all of Intel’s $10.9 billion in Chips and Science Act grants into equity. At Intel’s current market valuation, a 10% stake would be worth roughly $10.5 billion. The exact size of the potential stake and whether the administration will proceed with the plan remain undetermined, according to people familiar with the matter who requested anonymity.
The White House has not confirmed specific details.
The report also suggested the administration might consider converting other Chips Act awards into equity stakes, though it’s unclear if this approach has gained broader support within the government or if officials have discussed it with other potential companies.
News of the potential government investment initially sparked a rally in Intel shares last week, with the stock rising 23% for its best weekly gain since February. However, investors appeared to reassess the implications on Monday, sending shares lower.