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In a significant move for the American tech industry, the US government is set to become a major shareholder in Intel Corporation. This news comes as the US government seeks to bolster its domestic semiconductor sector and reduce reliance on foreign production.

On Tuesday, Intel's share price surged more than eleven percent to around $26 in early US trading. This upward trend was partly driven by the announcement of a $2 billion (1.7 billion euros) investment in Intel shares by Softbank, a Japanese technology company.

President Donald Trump has voiced his support for this move, believing it benefits American taxpayers. The investment is part of a broader strategy to encourage Intel to invest billions in US production expansion, according to reports.

However, Intel has been struggling in the semiconductor market, particularly in the AI chip business where Nvidia leads. The company is also under pressure in its traditional business with PC processors and data center chips. In an attempt to diversify, Intel is trying to establish itself as a contract manufacturer for other semiconductor providers, but progress has been slow.

The US government's stake could be purchased on the market for more than ten billion dollars. According to reports, the stake will be non-voting shares. The major shareholder of Intel who provided a multi-billion dollar financing package is the U.S. government, which acquired about 10 percent of the company through an $8.9 billion investment financed by the CHIPS and Science Act and related programs.

The US government's intention to become a shareholder in Intel was confirmed by Trade Minister Howard Lutnick. This move follows the US government's acquisition of a "golden share" in the takeover of US Steel by Nippon Steel.

Meanwhile, Softbank, the majority owner of chip designer Arm, is expanding its US activities. Arm's technology is used in almost all smartphones and tablet computers. Softbank is also involved in the "Stargate" project with OpenAI for AI data centers, further deepening its involvement in the US tech industry.

Trump has been vocal about his preference for high import tariffs to force companies to manufacture semiconductors in the US. However, the majority of high-tech chips, including those for smartphones, are still produced in Asia, mainly in Taiwan. The abandonment of plans for a large factory in Magdeburg due to lack of demand underscores the challenges faced by Intel in the semiconductor market.

Despite these challenges, the US government's investment in Intel is seen as a significant step towards strengthening the American semiconductor industry and reducing its reliance on foreign production. Softbank's purchase price for Intel shares is slightly below Monday's closing price at $23 per share, indicating a cautious approach by the investor.