A cash pile of $47bn and the backing of the Chinese government should be more than enough for a chipmaker to challenge the dominance of foreign rivals. Both were key assets of Zhao Weiguo, chair of Tsinghua Unigroup, when the mission began a few years ago. The group has little to show for it today. Creditors, a group that includes foreign bondholders, are calling for a restructuring.

Tsinghua’s woes are a big setback for Chinese hopes of chip self-sufficiency. China’s biggest chipmaker, Semiconductor Manufacturing International Corp, cannot make the higher-grade chips Tsinghua produces. Logic microprocessors built from 5 nanometre transistors are crucial for today’s technology, smartphones included.

An acquisition spree by Tsinghua made more sense than some. It bought French smart chipmaker Linxens, Hewlett-Packard’s networking gear unit, a stake in Western Digital and local mobile chipmaker Spreadtrum. The deals were supposed to make Unigroup one of the world’s top three chipmakers.