On Aug. 7, United States President, Donald Trump, publicly demanded the immediate resignation of Intel CEO, Lip-Bu Tan, citing what he describes as a “highly conflicted” relationship with communist China.
The president’s demand was posted to his social media platform, Truth Social on Thursday, after Republican Senator, Tom Cotton, issued a letter to Intel’s board of directors, raising concerns over Tan’s significant investments in Chinese companies and his previous business relationship with communist authorities in China.
“The CEO of INTEL is highly CONFLICTED and must resign, immediately. There is no other solution to this problem. Thank you for your attention to this problem!” the President wrote.
Tan is relatively new to the role, having taken the helm this past March.
According to a Reuters report from April, Tan has invested a minimum of $200 million into an estimated 600 Chinese companies over the past decades, including eight with direct ties to China’s People’s Liberation Army.
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Cotton also noted that prior to joining Intel, Tan was the CEO of Cadence Design Systems, a company that just last week pleaded guilty to illegally exporting technology to a Chinese Military university. The company agreed to pay $118 million in criminal penalties.
Cotton’s letter also asked whether Intel’s board required Tan to divest his financial interests in Chinese companies, especially those in the semiconductor sector with ties to the Chinese military or the Chinese Communist Party (CCP).
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Intel stock plummets
Trump’s demand immediately roiled Intel’s stock, causing it to plunge in the immediate hours following his post.
Shares fell 5 percent in premarket trading and was down overall by three percent as of noon in New York.
Intel is the recipient of a roughly $8 billion U.S. government grant under the CHIPS and Science Act, a 2022 law intended to boost the American semiconductor manufacturing industry.
“Intel is required to be a responsible steward of American taxpayer dollars and to comply with applicable security regulations. Mr. Tan’s associations raise questions about Intel’s ability to fulfill these obligations,” Cotton wrote in his letter.
Trump’s call for Tan’s resignation was immediately echoed by a number of American lawmakers, including Senators Bernie Moreno of Ohio and Rick Scott of Florida.
As a company, Intel has been struggling all year, battling a volatile stock market amidst steep competition from rival companies such as NVIDIA, Taiwan’s TSMC and Samsung Foundry, among others.
According to Business Insider, a White House official said that Trump “remains fully committed to safeguarding our country’s national and economic security. This includes ensuring that iconic American companies in cutting-edge sectors are led by men and women who Americans can trust.”
