Trump seeks control over strategic industries

Korea Economic Daily

Summary

Since Donald Trump took office, the U.S. government has actively secured stakes in strategic industries such as minerals and semiconductors, analysts say.
The Trump administration has invested more than US$10 billion in nine companies, including Intel and MP Materials, acquiring large-scale stake acquisitions or holding options.
These moves are seen as a strengthening of government control over strategic industries, and investors need to pay attention to changes in corporate governance and policy risk at those companies.

Intel stake secured in exchange for subsidies

Acquired stakes in 9 companies related to national interest

Since Donald Trump took office, Korea Zinc is not the only private company in which the U.S. government has acquired a stake. It has been purchasing stakes in companies that affect U.S. interests and national security, such as minerals and semiconductors.

According to the industry on the 17th, the Trump administration has invested more than US$10 billion (about 14.6 trillion won) in nine companies to acquire stakes or secure options to buy stakes in the future. A representative example is U.S. semiconductor company Intel. Last August, the U.S. Department of Commerce spent US$8.9 billion to acquire a 9.9% stake, becoming the largest shareholder. The purchase was financed by US$5.7 billion of undisbursed funds approved under the CHIPS Act and US$3.2 billion in Department of Defense subsidies. In effect, it received the stake for free in return for the subsidy that was originally scheduled.

In July, the Department of Defense invested US$400 million in U.S. rare-earths company MP Materials to buy a 7.5% stake and received an option to acquire an additional 7.5%. It also bought mineral companies such as Vulcan Elements (US$670 million), ReElement Technology (US$80 million), Trilogy Metals (US$35.6 million), and Lithium Americas (US$182 million). In October, it secured an option to purchase an 8% stake in nuclear power company Westinghouse. Korea Zinc was the first case in which it bought a stake in a foreign company.

Reporter Woo-seop Kim duter@hankyung.com