The Trump administration announced it will take a nearly 10% stake in Intel Corp. (Nasdaq: INTC) worth $8.9 billion, converting previously awarded grants into equity ownership as part of a broader plan to establish a US sovereign wealth fund.
The deal makes the federal government Intel’s largest single shareholder and represents what White House economic advisor Kevin Hassett called a “down payment” on creating an American sovereign wealth fund. The investment combines remaining funds from the CHIPS and Science Act with money from the Secure Enclave program.
“It’s like a down payment on a sovereign wealth fund, which many countries have,” Hassett told CNBC Monday, suggesting more such transactions would follow across multiple industries.
President Trump defended the arrangement on his Truth Social platform, writing: “I PAID ZERO FOR INTEL, IT IS WORTH APPROXIMATELY 11 BILLION DOLLARS. All goes to the USA. Why are ‘stupid’ people unhappy with that?”
The move is a significant departure from traditional US economic policy, with the government taking direct ownership stakes in private companies. Trump signed an executive order in February directing cabinet secretaries to develop plans for a sovereign wealth fund within 90 days.
Treasury Secretary Scott Bessent said the fund would “monetize the asset side of the US balance sheet for the American people” and would be operational within 12 months.
The administration has also secured revenue-sharing agreements with Nvidia (Nasdaq: NVDA) and AMD (Nasdaq: AMD), taking a 15% cut from certain semiconductor sales to China, and obtained a “golden share” in US Steel.
Critics, including former UN Ambassador Nikki Haley, warned against excessive government intervention in private markets. “Intel will become a test case of what not to do,” Haley wrote on X.
While oil revenues or trade surpluses typically fund traditional sovereign wealth funds, analysts question the US can finance this strategy, given the country’s massive budget deficit and $36.2 trillion national debt.
Administration officials insist the government won’t interfere with company operations while building what they describe as a strategic investment vehicle to compete with funds from countries like Saudi Arabia and Norway.
The Intel agreement still requires final documentation and regulatory approvals.
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