Trump’s administration agreement is structured to prevent Intel from selling a foundation unit

Trump’s administration seems to be intending to control Intel’s ability to make basic business decisions around the foundation unit of the foundry.

According to Report from economic timesAt a Deutsche Bank conference on Thursday, Intel David Zinsner’s CFO shared new details on the recent agreement of the company with Trump, which gave the US government 10% share capital.

The deal was structured in a way that punishes Intel if he turned his business foundation unit, which makes customized brands for external customers in the coming years.

Last week’s agreement included a five -year warrant that would allow the US government to receive an additional 5% of Intel at $ 20 per share if the company owned less than 51% share capital in the foundation company. Zinsner said he expects the warrant to expire.

“I think in terms of the government were aligned with it. They didn’t want to see us take the business and overcome it or sell it to someone,” he said.

Zinsner added that the company received $ 5.7 billion in cash Wednesday, as a result of last week’s agreement, according to Reuters. (Cash comes from the other grants previously granted, but have not yet been paid, to Intel in accordance with US brands and science.)

White Secretary of the White House Karoline Leavitt told reporters today that the deal was still ironed.

Intel refused to comment on the deal beyond Zinsner’s observations.

This structure of the agreement is clearly a proof of Trump’s desire to bring more chips to the United States, as many players in the industry are turning into the offshore production of Taiwan.

But this warrant also forces Intel to maintain a business unit that loses money. The Intel Foundry reported a functional loss of $ 3.1 billion in the second quarter and is a source of dispute for semiconductor operation.

There have been calls from analysts, board members and investors to overcome the foundation unit, which seemed to happen last fall, before the architect of the Intel Foundry, former CEO Pat Gelsinger, left.