The Chinese chip design business Unisoc (Shanghai) Technologies Co. is looking to raise 10 billion billion yuan ($1.5 billion) in a fresh investment round that will value the company at around 70 billion yuan ($10.3 billion).
In order to capitalise on rising local investor interest in China's domestic chip industry, which is preparing to be more self-sufficient in the face of U.S. pressure, the sources said, Unisoc has approached several state-backed investment institutions for the round.
By one of the participants, the company hopes to narrow its investor pool by the middle of March and conclude the transaction by the end of June in preparation for a potential domestic offering. Due to the confidentiality of the material, all of the sources declined to be named. According to the firm's official WeChat account, Jia Shaoxu, the board secretary, said the company would utilise the funds to increase the competitiveness of its technology and products when it revealed last week that it was seeking money. The sum was not disclosed.
Fundraising attempts are underway in China at the same time as President Xi Jinping is stepping up calls for the nation to become more technologically independent.
A variety of export restrictions have been implemented by Washington to stifle Beijing's technological and military advancements, including ones that limit China's access to American chip-making gear and shut it off from some chips produced anywhere in the world with American machinery.
The largest chip manufacturer in China, Semiconductor Manufacturing International Corp., as well as memory chip producer Yangtze Memory Technologies Co Ltd. are among the Chinese firms that the Biden administration has targeted (YMTC).
Private equity firm Wise Road Capital, which seized control of Unisoc in 2022 when its former parent company Tsinghua Unigroup declared bankruptcy, controls the corporation.
Shanghai-based Unisoc competes with Qualcomm Inc., MediaTek Inc., and Samsung Electronics Co. Ltd., and its product line comprises both straightforward chips for internet-connected devices and mobile processors for smartphones.
Its website states that it operates in 133 nations. Despite having lower sales than its competitors, Counterpoint Research estimates that the company's share of the global market for mobile CPUs will reach about 10% by 2022.
It stated in its statement from February 8 that it will have 14 billion yuan in revenue by 2022. According to an announcement from July 2022, it made 11.7 billion yuan in revenue in 2021.
In addition to Wise Road, the company's shareholders also include also China's state-backed investment fund for chips (known as "the Big Fund"), which has a 13 per cent stake in the firm, as well as Intel Capital, which retains an 11 per cent stake in the company via an investment from 2014.