Trump administration eyes equity stakes in US firms — but some companies are excluded: Here’s why

The Trump administration is in talks to acquire equity stakes in companies receiving subsidies from the 2022 CHIPS Act. The move would convert a portion of the grants pledged under the Act into government ownership.

The development comes after United States Commerce Secretary Howard Lutnick confirmed on Tuesday that the government is actively working on the possibility of acquiring a 10% stake in “troubled” chipmaker Intel, the Wall Street Journal (WSJ) reported on Thursday.

Which semiconductor companies are spared?

However, not all US chipmakers will be subject to this equity plan. According to the WSJ, the Trump administration does not intend to take equity shares in bigger semiconductor firms that are increasing their investments in the country.

The WSJ report, citing a government official, reported that “The Commerce Department is not looking to take equity from TSMC and Micron.”

Executives at Taiwan Semiconductor Manufacturing Company (TSMC) have reportedly discussed returning their subsidies to the administration if it asks to become a shareholder, according to the report.

Why are some semiconductor companies exempt?

The Trump administration will not seek equity stakes in businesses that are increasing their US investment pledges in exchange for funding, such as from the Chips Act, the report said.

Companies like TSMC are exempt because of their efforts to ramp up investment in the country, the official told WSJ.

TSMC, which counts Nvidia and Apple as key clients, announced plans for a $100 billion investment in the US, in addition to a previously committed $65 billion for three manufacturing facilities in the state of Arizona.

Context and past precedents

This policy shift aligns with a broader push by the US government to secure returns on its financial support to private companies, particularly in strategic sectors.

The US Commerce Department, which oversees the $52.7 billion CHIPS Act, formally known as the CHIPS and Science Act, late last year finalised subsidies of $6.6 billion for TSMC to produce semiconductors in the country.

Besides TMSC, companies like Intel, Micron and Samsung were among the biggest recipients of CHIPS Act funding.

In the past, the US government has taken stakes in companies during periods of economic instability to provide financial support and restore confidence, WSJ reported.