Intel investing in China mobile chipmakers: sources
Credit: Reuters/Beawiharta
Indonesian youth walk past an Intel sign during Digital Imaging expo in Jakarta March 5, 2014.
It was unclear how much Intel is paying or what portion of the companies the U.S. chipmaker is buying. The acquisition could be made through Tsinghua Unigroup, a government-affiliated private equity firm controlled by Tsinghua University in Beijing, one of the sources said. Tsinghua Unigroup owns Spreadtrum and RDA.
Struggling to gain traction in the smartphone and tablet market, Intel recently has sought to partner with mobile chipmakers in the hope they could help it regain the market dominance it enjoyed when personal computers reigned.
An Intel spokesman declined to comment. Tsinghua Unigroup did not respond immediately to a request for comment.
This week there have been several reports in China of a potential deal, including one on the sina.com.cn news portal quoting unnamed sources as saying Intel would get 20 percent of Tsinghua Unigroup for $1.5 billion.
The Beijing government has said in published policy papers it views semiconductors as an industry of vital strategic importance and hopes to spur its development domestically. China is the world's largest smartphone manufacturer and smartphone market.
Intel, under chief executive Brian Krzanich, has pursued an array of deals and strategies to ensure its mobile chip designs get into more smartphones and tablets. The newest investment comes less than six months after Intel reached an agreement with Chinese chip maker Rockchip to make inexpensive tablet chips with Intel's architecture and branding.
While Intel excels at developing processors for laptops and desktop computers, it has less experience designing 'system on chips' or SoCs, the key processors on mobile devices, which combine features like modems, WiFi and memory.
The Santa Clara-based company's stock has risen 32 percent this year, in part due to stabilization in demand for personal computers.
(Reporting by Noel Randewich and Gerry Shih, editing by Peter Henderson)
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