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Conversations are ongoing between Intel (NASDAQ:INTC) and the Biden administration, with the aim of securing more than $10 billion in subsidies to aid in the development of semiconductors.
The potential incentives are anticipated to consist of both loans and direct grants, as reported by Bloomberg on Friday, citing sources familiar with the matter. However, negotiations are still in progress.
The funds in question originate from the 2022 Chips and Science Act, which has allocated $39 billion for direct grants, and an additional $75 billion in loans and loan guarantees to support semiconductor companies in manufacturing chips within the United States.
Intel (INTC) and the Commerce Department have refrained from providing comments to Bloomberg at this time.
The specific allocation of Intel’s (INTC) potential award between grants and loans remains uncertain, as noted by the WSJ.
The recent development follows a late February report by the WSJ, suggesting that the Biden administration was poised to distribute substantial subsidies to Intel (INTC), Taiwan Semiconductor (TSM), and other semiconductor firms in the upcoming weeks, particularly for the establishment of new factories.
The initial WSJ report indicated an expected announcement of the subsidies before President Biden’s State of the Union speech on March 7. However, a separate Bloomberg report suggested a potential timing towards the end of March. Industry executives informed the WSJ that Micron (MU), Texas Instruments (TXN), and GlobalFoundries (GFS) are also prime candidates for receiving subsidies.
Last August, marking the one-year anniversary of the U.S. CHIPs Act coming into effect, the White House celebrated its accomplishments, including the fact that over 460 companies had expressed interest in securing funding by submitting statements of interest.
