In a significant shift in the American industry policy, the Donald Trump The government has acquired direct ownership interests in five large listed companies. This series of interventions, framed as a national security strategy, marks a new era of government involvement in important industries to secure the domestic supply chains for semiconductors, critical minerals and steel.
The new portfolio of the Trump government
The government’s acquisitions includes a 10% interest in the semiconductor giant Intel Corp. (Nasdaq: Intc), a 15% interest in a producer of rare earth metals MP Materials (NYSE: MP), an interest of 10% in Lithium America Corp. (NYSE: LAC), an interest of 10% in Trilogy Metals Inc. (NYSE: TMQ), and a “golden share” in US Steel Corporation.
Intel
- The government converted previously granted Chips ACT subsidies into an investment of $ 5.7 billion for a share interest of 10% in the semiconductor giant. The unprecedented deal is intended to prevent a possible spin-off from Intels very unprofitable foundry activities.
- The agreement also includes a five-year Warrant with which the government can acquire another 5% at $ 20 per share as Intel’s ownership in the foundry unit falls below 51%.
- When the deal was completed on August 22, the share closed that day at $ 24.80 per share, with a return of almost 47.54% on October 6 and closed at $ 36.59 per share.
- This share retained a stronger Koerstrend in the short, medium and long term, with a poor growth position. Additional performance details are available here.
MP Materials
- To combat Chinese dominance in the world On the global market for rare earth metals, the Ministry of Defense (DOD) has entered into a public-private partnership with MP Materials.
- Due to the deal, the DOD acquired an interest that represented around 15% of all shares, making it potentially the largest shareholder in the company. MP Materials operates the only fully integrated mining and processing facility for rare earth metals in the US
- After the deal was completed on 11 July, the share has since risen by 64.77%, from $ 45.11 per share to $ 74.33, after all, from 6 October.
- MP maintained a stronger price trend in the short, medium and long term, with a bad growthore. Additional performance details are available here.
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Lithium America
- The loan supports the Thakker Pass-Lithium mine of the company in Nevada, which is expected to be the largest lithium mine in the western hemisphere when production starts in 2028. The project is intended to strengthen the American domestic lithium cooling chain for products such as batteries for electric vehicles.
- Since the acquisition of the shares by the government on 1 October, 20% has risen by 7.04 per share to $ 8.45 on October 6.
- Lac maintained a stronger price trend in the short, medium and long term. Additional performance details are available here.
Trilogy metal
- The White House has announced plans to take a 10% interest in Trilogy Metals through an investment of $ 35.6 million to support the mining exploration in the Ambler Mining District in Alaska.
- The investment includes warrants to buy another 7.5% of the company. The measure is intended to unlock access to one of the world’s largest undeveloped copper-Zink mineral belts.
- Due to the announcement of the deal, the share rose on Monday by 215.30% on the market outside office hours.
- TMQ maintained a stronger price trend in the short, medium and long term. Additional performance details are available here.
American steel company
- In a unique way, the government assured itself of a “golden share” in US Steel as part of the acquisition by Japan Nippon Steel Corp. (OTCPK: NISTF).
- This does not represent a typical share interest, but instead gives the US government a permanent veto right on important business decisions, including the relocation of the headquarters from Pittsburgh, moving production abroad or closing facilities.
- The government acquired this golden share in the company on June 18 and since then the OTC market shares have fallen by 77.80%.
Trump administration Eyes Defense Contractors
This strategy of direct investments can extend further, such as Minister of Trade Howard Lutnick confirmed that the government is considering buying ownership interests in major defense contractors.
Lutnick pointed to companies like Lockheed Martin Corp. (NYSE: LMT), and notes that they are, since they get almost all their income from the US government, “in fact a branch of the US government.” The news led to a rally of defense shares.
Price promotion
The SPDR S&P 500 ETF TrusT (NYSE: Spy) and Invesco QQQ Trust ETF (Nasdaq: QQQ), who follow the S&P 500 index and the Nasdaq 100 index respectively, went ahead on Monday. The Spy rose by 0.36% to $ 671.61, while the QQQ rose by 0.75% to $ 607.71. Pro for petrol facts.
The futures of the S&P 500, Dow Jones and Nasdaq 100 Indices were lower on Tuesday.
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