Tsinghua Unigroup, the former highflyer whose business partners include global tech giants Intel and Hewlett Packard, was forced into restructuring under China’s bankruptcy law in July. From 2012 to 2021, the group’s business expanded aggressively after nearly 60 acquisitions, constructing the layout from chips to the cloud. The acquisitions, coupled with Covid-19, tipped the group into severe financial crisis. Unigroup, saddled with over 200 billion yuan (US$30.8b) in liabilities, was looking for a white knight to help clear its debts to continue its semiconductor and cloud computing businesses, according to the company’s statement on the website of China’s National Enterprise Bankruptcy Information Disclosure Platform. Integrated circuit production, including high-end chip design and manufacturing, has four characteristics including large investment, high risks, long-term returns and scale effect, making it less attractive to private capital and even State assets. Insiders argued that despite the difficulties, Tsinghua Unigroup’s core business is still bright at a time when China supports homemade chips and the digital transformation drive is in full swing.