Lip-Bu Tan, the newly appointed CEO of Intel, has invested in hundreds of Chinese technology companies, including several linked to China's People's Liberation Army as well as Semiconductor Manufacturing International Corp. (SMIC), China's foundry champion, according to a review of American and Chinese corporate documents conducted by Reuters. The information raises concerns due to Intel's close work with the U.S. defense sector.
The corporate documents reviewed by Reuters show that Tan controls over 40 companies in China and has minority stakes in over 600 entities in China via investment companies he manages or owns. The value of the stakes is at least $200 million. Some of the companies Tan has invested in are contractors and suppliers for the People's Liberation Army. In numerous cases, Tan's stakes are shared with Chinese state-owned groups or regional government-backed investment funds.
Tan has made many of his investments through Walden International, the venture capital firm he founded in 1987 and which he still chairs. He has also used two Hong Kong-based entities — Sakarya Limited and Seine Limited — for investment purposes. Tan is the sole owner of Sakarya, whereas Seine is under Walden's control.
Through his venture capital firm, Walden International, and affiliated entities, Lip-Bu Tan has invested in several Chinese technology companies, including those that are now on the U.S. Department of Commerce's Entity List for their alleged ties with China's government, military, and secret services.
The list of such companies includes SMIC (China's top chipmaker, though Walden exited its SMIC investment in 2021), Dapu Technologies (a PLA contractor), HAI Robotics (a contractor to Chinese surveillance companies and a bidder for a PLA contract), Intellifusion (a surveillance technology company), QST Group (a sensor supplier for Russian military drones captured in Ukraine), and Wuxi Xinxiang Information Technology Co. (a supplier to YMTC).
Holding shares in Chinese companies with ties to the military and secret services is legal unless those firms appear on specific U.S. government restriction lists, such as the U.S. Treasury's list of Chinese Military-Industrial Complex Companies. Yet, there are, of course, ethical concerns about investing in Chinese surveillance companies as well as companies supplying technology for the Russian army.
While the Chinese companies controlled by Lip-Bu Tan barely compete against Intel, their ties to the PLA certainly raise concerns. Also, industry observers note it is odd for a CEO of Intel to own a stake in contract chipmaker SMIC as Intel is trying to become a foundry itself.
Some investors and observers see Tan's ties to hundreds of companies in China as a liability. Andrew King, a partner at Bastille Ventures, questioned Tan’s suitability for leading a company with defense connections, citing national security concerns. Stephen Diamond, a law professor at Santa Clara University, said these types of ties should be a major concern for Intel's leadership, given the political climate.
However, others view Tan's extensive experience in Chinese tech as an asset. Bernstein analyst Stacey Rasgon called Tan a highly regarded figure among investors and praised his decades-long track record in the field.
Intel did not provide direct comments on Tan's investments but stated that he completed a required disclosure form for company executives, as mandated by the SEC.
