White House spokesman Kush Desai declined to comment on the specifics of the discussions, saying only that no deal is official until it’s announced by the administration. The Commerce Department, which oversees the Chips Act, also declined to comment. Intel didn’t respond to a request for comment.

SoftBank’s investment is another unconventional bet on Tan’s ability to revive Intel’s fortunes. The Japanese company announced its plan to buy new shares at $23 a share, a small discount to Intel’s last close. Son has ambitions to design an energy-efficient AI chip through what he calls the “Izanagi” project to compete with Nvidia’s products, though that has yet to translate into a marketable product.

Son held talks with Intel’s chief executive about buying the company’s contract chipmaking business before agreeing to make the $2 billion investment, the Financial Times reported, citing people familiar with the talks. The investment doesn’t preclude a bigger deal for that part of Intel’s business, the newspaper said.

A big question is whether a government holding and SoftBank’s vote of confidence would help reinvigorate Intel’s business. The tech pioneer has fallen behind Taiwan Semiconductor Manufacturing Co. in contract chipmaking and Nvidia Corp. in chip design, missing out on a boom in spending on artificial intelligence.

Last week, Intel’s stock had its biggest one-week rally since February, after the initial news of the government’s possible investment.

Tan, who served on SoftBank’s board for two years, is seeking a turnaround. But his efforts have largely been focused on cutting costs and eliminating jobs. Intel will add large-scale manufacturing capacity only once customers are committed to using its more advanced production techniques, Tan said last month, sparking concern among investors that the company may be bowing out of the race for semiconductor leadership.

The Trump administration is particularly focused on shoring up Intel’s sprawling project in Ohio, the home state of Vice President JD Vance. Intel has repeatedly delayed the anticipated opening of that site, which the company originally envisioned as the world’s biggest semiconductor facility.

Beyond Intel, the White House official also floated the possibility that the administration could convert other Chips Act awards into equity stakes. It’s not clear whether that idea has gained traction broadly within the administration or whether officials have broached the possibility with any companies that could be affected.

The Chips Act set aside $39 billion in manufacturing grants — plus loans and tax credits — to revitalize the American semiconductor industry after decades of production shifting to Asia. Using Chips Act money for an Intel stake would mean the chipmaker isn’t necessarily getting a bigger government infusion than expected — possibly just one that’s on a faster timeline. As is the case for all Chips Act winners, Intel’s award was designed as a reimbursement, with the grant money split into tranches tied to specific project benchmarks.

Intel had received $2.2 billion of its award as of January. It’s unclear whether that amount would be included in the possible equity stake, whether the company has received additional disbursements of its award since Trump took office, and on what schedule Intel would receive money under a possible equity stake.

While TSMC and South Korea’s Samsung Electronics Co. are expanding their US operations with Chips Act support, having an American company like Intel building cutting-edge chips on domestic soil has been a priority for both the Trump and Biden administrations.

Biden officials, for example, tried to get companies like Nvidia and Advanced Micro Devices Inc. to consider using Intel as a manufacturing partner, and also explored long-shot ideas like a tie-up between Intel and GlobalFoundries Inc.

Earlier this year, Trump’s team held early-stage conversations with TSMC about potentially operating Intel’s factories — an arrangement from which TSMC has backed away. Trump officials have also internally floated the prospect of seeking an Intel investment from the United Arab Emirates. It’s unclear whether either of those approaches has progressed much past a thought exercise.

Washington has become more aggressive in strategic sectors. The Trump administration’s secured an agreement to receive a 15% cut of AI chip sales to China and took a so-called golden share in United States Steel Corp. as part of a deal to clear its sale to a Japanese rival. That’s while the Defense Department announced a plan that would make it the largest shareholder in US rare-earth producer MP Materials Corp.

The US government and the Japanese tech conglomerate both see the potential for a turnaround at Intel, although each likely values different parts of the business. For the Trump administration, a recovery of the chipmaker’s manufacturing prowess would help win jobs and voters. For SoftBank, Intel’s chip design operations beckon with the promise of high margins.

--With assistance from Brody Ford, Ville Heiskanen, Ryan Gould, Josh Wingrove, Min Jeong Lee and Edwin Chan.

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