The Trump administration might decide to acquire a stake in all CHIPS Act beneficiaries, which would put TSMC in a challenging position when it comes to the firm's autonomy.
Samsung, Micron & TSMC Could Be Forced Into President Trump’s ‘Equity Model
For those unaware, the US government is looking to adopt a 'chip subsidy-for-equity' model, according to remarks made by Commerce Secretary Howard Lutnick. More specifically, the equity stakes will be taken in exchange for CHIPS Act grants, which means all the eligible firms under the government scheme will need to give a portion of their company to the Trump administration. This means that TSMC could come under pressure for an equity sell-out, which might prove to be a difficult move politically and financially.
One recent example of the chip subsidy-for-equity model is how the Trump administration is working on a deal to take a 10% stake in Intel, given that the firm was the biggest beneficiary of the CHIPS Act. Similarly, firms like Samsung, Micron, and, more importantly, TSMC are also under the government's radar, but for the Taiwan giant, giving a stake will be the most difficult out of the bunch, and we'll discuss why ahead.
Taiwanese media sources claim that the equity stake measure could influence TSMC's operations since the firm has operated without considering political factors. While the USG has guaranteed that the equity would not influence the firm's decision, it is a way of bringing taxpayers' money back into the government. TSMC still faces uncertainty, given that the domestic media still sees the move as America looking to 'nationalize' Taiwan's assets, converting it into a US foundry.
For now, there's no development around the Trump administration taking a stake in TSMC, and given the latter's investments in the region, this model might not be applied to the Taiwan giant, but we'll have to wait and see.
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