SoftBank Bets $2 billion on Intel as U.S. Eyes 10% Stake

Intel (NASDAQ:INTC) popped after SoftBank (SFTBY) agreed to pour $2 billion into the chipmaker. The Japanese firm is buying shares at $23 apiece, giving it just under a 2% stake, according to LSEG data.

That makes SoftBank Intel's sixth-largest investor, though it won't be angling for a board seat or locking in chip purchases. Instead, it's a straightforward bet on Intel's future. We are very pleased to deepen our relationship with SoftBank, Intel CEO Lip-Bu Tan said, adding the two companies share a commitment to U.S. tech leadership. SoftBank founder Masayoshi Son called it a vote of confidence in America's expanding semiconductor manufacturing, with Intel at the center of it.

Warning! GuruFocus has detected 10 Warning Signs with INTC.

The timing is striking. Bloomberg reported earlier in the day that Washington is in talks to take a 10% stake in Intel itself. For investors, that one-two punch SoftBank stepping in now and the U.S. government potentially following shows just how critical Intel has become in the global chip race.

This article first appeared on GuruFocus.

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