The U.S. government will take a 9.9% stake in Intel Corp. after converting $8.9 billion of previously awarded federal grants into equity, according to a securities filing on Monday. Washington will receive 433.3 million non-voting shares priced at $20.47 each—below Intel’s last close—and a five-year warrant to purchase a further 5% if the chipmaker sells control of its foundry business. The transaction makes the government Intel’s third-largest shareholder, behind BlackRock and Vanguard. National Economic Council Director Kevin Hassett said the deal, funded through the CHIPS and Science Act and the Pentagon’s Secure Enclave programme, is intended to secure domestic semiconductor production while giving taxpayers a financial return. He told CNBC the administration could replicate the model in other industries as part of a prospective sovereign-wealth fund. President Donald Trump, who recently criticised chief executive Lip-Bu Tan, declared that the government “paid zero” for the stake and vowed to pursue “many more” similar arrangements. Intel warned in the filing that federal ownership could weigh on international sales, deter future grants and dilute existing investors—dilution that will rise to roughly 11% once an 87-million-share placement to SoftBank is completed. Bernstein analyst Stacy Rasgon reiterated a ‘Market Perform’ rating with a $21 price target, advising clients to avoid the stock. Even so, Intel gained about 2% to $24.80 in pre-market trading as investors digested the unprecedented intervention.