Intel (INTC, Financials) shares dropped 5% Monday after Bloomberg reported the Trump administration is considering taking about a 10% stake in the chipmaker.
According to the report, officials may convert some or all of Intel’s $10.9 billion in Chips and Science Act grants into equity. At current valuations, a 10% stake would equal roughly $10.5 billion. People familiar with the talks said no final decision has been made, and the White House has not confirmed details.
The administration is also weighing whether to apply a similar approach to other Chips Act recipients, though discussions remain preliminary.
Intel stock initially rallied last week on speculation of a government investment, gaining 23% for its best weekly performance since February. Investors reassessed the implications Monday, sending the shares lower.
This article first appeared on GuruFocus.