Aug. 19 (UPI) — U.S. chip maker Intel is getting a $2 billion lifeline from Japan’s SoftBank, the companies announced Monday.
SoftBank Group and Intel Corporation have signed a definitive securities purchase agreement, with SoftBank investing $2 billion in Intel common stock and the future of semiconductor innovation in the United States.
“Semiconductors are the foundation of every industry. For more than 50 years, Intel has been a trusted leader in innovation,” said Masayoshi Son, chairman and chief executive officer of SoftBank. “This strategic investment reflects our belief that advanced semiconductor manufacturing and supply will further expand in the United States, with Intel playing a critical role.”
SoftBank will pay $23 for each share of Intel common stock, under the terms of the agreement. The investment allows Intel to continue building on its vision of advance technologies for cloud computing, digital transformation and next-generation infrastructure.
“We are very pleased to deepen our relationship with SoftBank, a company that’s at the forefront of so many areas of emerging technology and innovation, and shares our commitment to advancing U.S. technology and manufacturing leadership,” said Lip-Bu Tan, CEO of Intel. “Masa and I have worked closely together for decades, and I appreciate the confidence he has placed in Intel with this investment.”
SoftBank’s private investment comes as the U.S. government considers its own rescue plan for the struggling chip maker. In an effort to revive Intel’s semiconductor manufacturing in the United States, the Trump administration is considering taking a 10% stake in the company, according to The Wall Street Journal and Bloomberg.
The investment also comes after President Donald Trump called for Tan to resign as head of the company, calling him “highly conflicted.”
Sen. Tom Cotton, R-Ark., also expressed concerns about “the security and integrity of Intel’s operations and its potential impact on U.S. national security.”
“Mr. Tan reportedly controls dozens of Chinese companies and has a stake in hundreds of Chinese advance-manufacturing and chip firms,” Cotton added.
Tan served as the CEO of Cadence Design Systems, a tech software company, between 2009 and 2021. In July, the company was charged by the Justice Department with conspiracy to commit export control violations.
Tan said earlier this month, he has “always operated within the highest legal and ethical standards” and that his “reputation has been built on trust, on doing what I say I’ll do, and doing it the right way.” Trump met with Tan last week, with the president calling the meeting “very interesting.”
Since Tan took over in March, Intel has laid off about 15% of its staff. After shares closed lower Monday, Intel’s stock jumped in after-hours trading following news of SoftBank’s investment.