Tsinghua Unigroup is on a $23 billion bid to buy U.S. memory chip maker Micron Technology Inc., in what could be the largest Chinese firm takeover, Wall Street Journal reports.
The Beijing-based company's origins are at Tsinghua University, considered the MIT of China. It was one of the universities that underwent the spin-off policy launched by China in 2000, turning it into a state-owned tech company.
"I think this is enormous. Not only because of the size of it, but because a Chinese company is investing so much in such an important piece of technology," said Patrick Moorhead of Moor Insights and Strategy in Austin, Texas, USA Today reports.
The Chinese government has budgeted as much as 1 trillion Yuan, equivalent to $161 billion, on the chip industry over the next five to 10 years, consulting firm McKinsey & Co. estimates, according to Bloomberg.
"This is the right move for Tsinghua because Micron has memory chip technology, which is very hard to develop," said Gu Wenjun, chief analyst at iCwise, a Shanghai-based consulting company, Bloomberg reports. However, Wenjun also said that with the strict review that the U.S. has on foreign capital, especially by China, there is little possibility that this would be approved.
Buying Micron would give China access to both DRAM and NAND memory chips, which are used in personal computers and to store music, pictures and other data on smartphones and mobile devices, Reuters reports.
