Intel announces $1.5 billion investment in 2 Chinese chipmakers

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Chip maker Intel on Friday announced it is investing nearly $1.5 billion for a 20 percent stake in Beijing-based Tsinghua Unigroup which owns Chinese chipmakers Spreadtrum Communications and RDA Microelectronics.

Through the deal with government-affiliated private equity firm Tsinghua Unigroup, Intel aims to acquire stake in chip manufacturers Spreadtrum Communications and RDA Microelectronics.

Both the fabless semiconductor companies manufacture chips for smartphones, feature phones, and other consumer electronics devices, which support 2G, 3G and 4G wireless communications standards.

Announcing the deal Intel said the purpose of the deal is to expand the company’s product offerings and adoption for Intel-based mobile devices in the Chinese market. As per the chip maker, the investment into Tsinghua Unigroup will result in the creation and sale of a new range of Intel architecture-based system-on-chips (SoCs).

Intel CEO Brian Krzanich in a statement said China, which is currently the largest consumption market for smartphones, has the largest number of Internet users across the world.

He said the partnership will enhance the company’s ability to support a wider range of mobile customers in China and the rest of the world by more quickly delivering a broader portfolio of Intel architecture and communications technology solutions.

The investment is subject to regulatory approvals and is expected to close in early 2015, the chip maker said.
Intel claims the new chips will be available “beginning in the second half of next year.”