$22 billion

Amount that Unigroup will raise in financing from investors to expand its chip business

to give Spreadtrum RDA’s 5G launch plan a shot in the arm.

Spreadtrum RDA came into existence after Tsinghua Unigroup bought Spreadtrum Communications and RDA Microelectronics Inc three years ago and merged them into a new company.

It is locked in fierce competition with MediaTek Inc in the market for lower end smartphone chips, and hopes to join the ranks of global giants such as Qualcomm Inc in the premium segment.

“The design of 5G chips is definitely more sophisticated, for the new technology demands faster speed and quicker response, which complicates the task of balancing power and performance, and integrating resources and lower costs,” Kang said.

The company’s R&D of 5G chips starts from 12 nanometer technology and plans to leverage a more advanced 7 nanometer technology for mass production. Nanome- ter technology refers to a technical standard used in chip device fabrication.

Spreadtrum RDA is part of Tsinghua Unigroup’s broad efforts to develop homegrown chips so as to reduce China’s reliance on foreign semiconductors.

Unigroup signed agreements in March that would grant it up to 150 billion yuan ($21.8 billion) in financing, which would enable it to expand its chip business.

It is working on a $30 billion domestic chip production complex in Nanjing, Jiangsu province. When completed, it would be China’s largest such facility.

In 2016, Spreadtrum RDA shipped 600 million smartphone chips, accounting for one-fourth of the world’s total shipments.