Intel just got locked in by the Trump administration over its foundry business.
The U.S. government now owns a 10% equity stake and slapped a 5-year warrant on Intel. That warrant lets the government grab an extra 5% in shares at $20 each if Intel’s foundry unit drops below 51% ownership.
Intel CFO David Zinsner spilled the details at a Deutsche Bank event Thursday. The deal’s designed to block Intel from spinning off or selling its custom chip unit within the next few years. 
Zinsner said this about the government’s stance:
“I think from the government’s perspective, they were aligned with that; they didn’t want to see us take the business and spin it off or sell it to somebody.”
Intel also received $5.7 billion in cash Wednesday. The money comes from unpaid grants under the U.S. CHIPS and Science Act. The White House says the deal is still ongoing negotiations.
This move forces Intel to hold onto the money-losing foundry branch, which lost $3.1 billion in Q2 alone. Analysts, investors, and board members have been pushing for Intel to spin it out—something that was close last fall until former CEO Pat Gelsinger quit in December.
Intel declined to comment beyond Zinsner’s remarks. The Trump administration clearly wants more U.S.-based chip manufacturing. Meanwhile, Intel must now keep the struggling foundry unit in play.
