New | ZTE’s chip-making arm sells 24 per cent stake to state-backed fund for 2.4b yuan
The money will be used to help ZTE expand in China and overseas
Efforts by mainland China to expand its semiconductor industry moved another step forward as a state-backed fund agreed to invest 2.4 billion yuan in ZTE Microelectronics Technology, a subsidiary of the country’s second-largest telecommunications equipment manufacturer.
The National Integrated Circuit Industry Investment Fund Corporation, which counts the Ministry of Finance, China Development Bank and China Mobile as shareholders, will buy a 24 per cent equity stake in the Shenzhen-based chip developer, according to a statement on Tuesday from Hong Kong-listed parent ZTE.
In a regulatory filing outlining the agreement late Monday, ZTE chairman Hou Weigui said the investment would bolster its plans to expand in China and overseas.
“The introduction of strategic capital will allow ZTE Microelectronics to strengthen its research and development capabilities, and reserve of core patents,” Hou said.
ZTE Microelectronics, which has a registered capital of 100 million yuan, currently develops chipsets deployed in cellular base stations used by telecommunications network operators to support multiple frequency band wireless access.
The company also develops semiconductor technologies used in smartphones and other mobile devices shipped to China as well as to Brazil, Indonesia and Russia.