Chinese government invests more than 20 billion euros in chipmaker Tsinghua
Tsinghua Unigroup, a chipmaker in which the Chinese state owns a majority stake, has received an investment of more than 20 billion euros. The investment comes from the Chinese Development Bank and a Chinese government fund that supports the Chinese chip sector.
Until 2020, the Chinese development bank will invest an amount of more than 13.5 billion euros. The remainder comes from the National Integrated Circuit Industry Investment Fund, established in 2014. Tsinghua Unigroup made this known in a statement on the website. Both investors are in fact part of the Chinese government. The chip fund is co-financed by China Tobacco, China Mobile and other Chinese state-owned companies.
The chipmaker has not said exactly how the capital will be used. The money is intended to help the company grow rapidly, accelerate technological developments and improve its competitive position, according to the statement. Tsinghua wants to eventually join the largest chip manufacturers in the world.
In January, it was announced that Tsinghua has invested 28 billion euros in the construction of a memory factory. It would be about dram memory and 3d-nand memory, EETimes wrote. The facility should eventually be able to process 100,000 wafers per month. It is not yet clear when construction will be completed.
At the end of 2015, Tsinghua Unigroup announced its intention to play a major role in the global chip market, joining the ranks of manufacturers Intel, Samsung, TSMC and GlobalFoundries. The company aims to achieve that position by investing billions in production facilities and acquisitions.
Tsinghua is also working on another memory factory in the Chinese city of Wuhan. The construction of that fab, which involves an amount of 22.5 billion euros, was announced last March. In the same year, the Chinese chip manufacturer attempted to acquire Micron with a bid of 21 billion euros. That takeover fell through because regulators in the US would probably not approve the takeover.
The chipmaker has made several acquisitions in recent years. At the end of 2013, the company acquired Chinese chipmakers Spreadtrum and RDA Microelectronics, making it the largest chip manufacturer in China. Spreadtrum mainly makes smartphone processors and RDA Microelectronics mainly makes technologies for mobile communication. Intel acquired a 20 percent stake in Tsinghua Unigroup in 2014.
Tsinghua Unigroup was founded in 1988 from Tsinghua University and is 51 percent owned by the Chinese state-owned company Tsinghua Holdings. The remaining 49 percent is owned by an investment group. The construction of the memory factories is in line with the plans of the Chinese government to replace as much foreign technology as possible with its own variants. That ‘replacement program’ should be completed in 2020.