Intel Pays $1.5 Billion for Stake in Chinese Chip Maker

Intel has acquired a 20% stake in China’s Tsinghua Unigroup, a state-owned company that owns China’s second and third largest chip designers, Spreadtrum Communications and RDA Microelectronics. Intel spent $1.5 billion to acquire the stake, which it says will enable Intel to increase its presence in the smartphone and tablet markets.

China’s Ministry of Industry and Information Technology is keen for China to develop its semiconductor industry, having said last December that it would allocate $5 billion to the sector to fuel mergers and enhance production facilities. Intel has said that the two companies will jointly develop Intel-based chips for mobile phones for China and other markets.