Intel is making a play for a bigger share of the lucrative mobile chip market in China with a $1.5bn (£919m) investment in two government-backed chipmakers.
The American firm has taken a 20 per cent stake in Tsinghua Unigroup, the private equity owner of Spreadtrum and RDA Microelectronics, which manufactures chips for smartphones.
The deal expands Intel's foothold in the mobile chipmaking business and in the huge Chinese mobile market.
Intel boss Brian Krzanich said: "China is now the largest consumption market for smartphones and has the largest number of internet users in the world. These agreements with Tsinghua Unigroup underscore Intel's 29-year-long history of investing in and working in China. This partnership will also enhance our ability to support a wider range of mobile customers in China and the rest of the world by more quickly delivering a broader portfolio of Intel architecture and communications technology solutions."
Intel has largely been known for producing chips for the PC market while rivals such as Qualcomm have capitalised on the surging mobile market.
The deal will be subject to regulatory approval from the Chinese government.