Howard Lutnick, the U.S. Secretary of Commerce, is reported to be considering a plan to provide subsidies under the Chips Act through equity conversion rather than cash. The Trump administration is keeping the possibility of applying equity conversion to other corporations supported by the semiconductor law, such as TSMC and Samsung Electronics, open following discussions about acquiring a 10% stake in Intel.
On the 19th (local time), Reuters quoted an anonymous source stating that Minister Lutnick is internally discussing the plan to convert subsidies into equity for major manufacturers building semiconductor plants in the U.S. This includes Taiwan's TSMC, Korea's Samsung Electronics, and America's Micron. However, the discussions started with Intel, and the application for other corporations has not yet been decided.
The subsidies confirmed at the end of the previous Biden administration include $6.6 billion for TSMC (approximately 9.2 trillion won), $6.2 billion for Micron (approximately 8.6 trillion won), and $4.75 billion for Samsung Electronics (approximately 6.6 trillion won). Minister Lutnick pointed out last June that the support funds are 'too generous' and stated that the Department of Commerce is currently renegotiating with corporations.
The plan to change subsidies to equity conversion is essentially an extension of the support method for Intel. The Trump administration is reviewing a plan to convert a part of the allocated $10.9 billion (approximately 15 trillion won) subsidy for Intel into equity, ensuring that the government secures about a 10% stake. Given that Intel's market capitalization is approximately $100 billion (approximately 139 trillion won), the value of a 10% stake would be about $10.5 billion (approximately 14.6 trillion won).
The White House officially confirmed during a briefing that it is discussing the equity conversion plan for Intel. Karoline Leavitt, a spokesperson for the White House, explained that 'the president emphasizes the need for reshoring essential manufacturing for national security and economic security,' adding that the idea of converting subsidies into equity is 'a creative idea that also returns benefits to taxpayers.' It is reported that Minister Lutnick is leading the Department of Commerce in coordinating the details, and Treasury Secretary Scott Bessent is also participating in the discussions.
If this plan materializes, overseas semiconductor corporations such as Samsung Electronics that have decided to invest in the U.S. will face new burdens. The industry raises concerns that if subsidies are converted into equity, not only will uncertainty about investment conditions grow, but also that the government's participation as a major shareholder may lead to management interference or potential concentration of support for certain corporations.
Kim Hyuk-jung, a deputy researcher at the Korea Institute for International Economic Policy (KIEP), stated, 'The mere possibility of subsidies being converted into equity significantly lowers the predictability of corporations' investment plans in the U.S.' He added, 'If the government participates as a shareholder, there could also be demands for dividends or adjustment of business direction, which could introduce new variables into the management strategies of Korean corporations.'