Intel received $5.7 billion in cash on Wednesday night as part of the deal U.S. President Donald Trump negotiated for a 10% stake in the struggling chipmaker, finance chief David Zinsner said at an investor conference on Thursday.
The stake in Intel announced by the U.S. government last week is an incentive for Intel to retain control of its contract manufacturing business, or foundry, Zinsner said.
As part of the deal, the government negotiated an additional 5% warrant, should Intel cease to own more than 51% of its foundry operation.
“I don’t think there’s a high likelihood that we would take our stake below 50%,” Zinsner said. “So ultimately, I would expect [the warrant] to expire worthless.”
Intel has taken steps to separate its contract chip manufacturing arm, or foundry, from its design business. The company has previously said it could take outside investment in the foundry unit, and it has created a separate management board to govern it.
Intel shares were down 0.8%, at $24.64, on Thursday afternoon.
—By Arsheeya Bajwa, Max A. Cherney, and Stephen Nellis, Reuters
