Tsinghua Unigroup Ltd, a Chinese state-backed technology conglomerate, is looking to buy US chipmaker Micron Technology Inc for $23 billion.

If approved, it would be the largest Chinese takeover of a US company to date. But many analysts believe the plan would face steep regulatory hurdles on both sides.

Tsinghua Unigroup is prepared to bid $21 per share for Micron, which closed up $2, to $19.61 on Tuesday. The offer could come as early as Wednesday, a person close to Tsinghua told Reuters.

Micron spokesman Dan Francisco e-mailed China Daily that the company "does not comment on rumor or speculation". Unigroup representatives declined to comment.

The Wall Street Journal first reported the story on Tuesday, citing sources.

Gene Cao, a senior analyst at consultancy Forrester Research Inc, said Unigroup would greatly benefit from the takeover.

"Unigroup is planning the acquisition because Micron will enhance its product lines of embedded chipsets and related hardware, as well as flash storage and memory computing," Cao said.

Micron, based in Boise, Idaho, also could boost Unigroup's smart-manufacturing capability, he said, so that the Chinese company will be better positioned in the next-generation chip manufacturing and Internet of Things segments.

Vincent Gu, a Shanghai-based analyst at iSupply, told Reuters that the chances of the US government approving the deal between Micron and Tsinghua Unigroup would be "next to zero", given the political hurdles.

"China should stay firmly grounded and persevere with researching the technology itself," he said.

Gu Wenjun, chief analyst at iCwise, a Shanghai-based consulting company, told Bloomberg News: "There is only a small possibility US regulators will approve this deal because it has a very strict review over offers from foreign capital, especially China." But "this is the right move for Tsinghua because Micron has memory chip technology, which is very hard to develop."

Tsinghua Unigroup was founded in 1988 at China's Tsinghua University, which is the alma mater of Chinese President Xi Jinping and other senior officials.

The company became China's largest chip-design firm after it acquired two of the country's largest mobile-chip makers, Spreadtrum Communications and RDA Microelectronics, in 2013.

Micron, which was founded in 1978, has been a key player in the semiconductor industry for more than three decades.

The company makes silicon-to-semiconductor products, including both dynamic random access memory (DRAM) chips and NAND memory chips that allow storage of music, pictures and other data on cameras, smartphones and other mobiles devices. Micron also specializes in other semiconductor systems.

As the only US-based DRAM manufacturer, any foreign takeover of Micron likely would have to pass a review by the Committee on Foreign Investment in the United States.

A deal also could face scrutiny from China's National Development and Reform Commission, which must approve outbound investments worth more than $2 billion, or those in sensitive industries.

If completed, the takeover will be the biggest in Chinese history, topping oil giant CNOOC Ltd's $15.1 billion takeover of Canadian oil and gas producer Nexen Inc in early 2013.

A successful bid would consolidate Tsinghua Unigroup's position as a champion for China's technology development, after it struck deals and research partnerships with international firms in the semiconductor industry.

In May, Tsinghua Unigroup spent $2.3 billion to acquire majority control of Hewlett-Packard Co's China networking equipment unit. In September, Intel Corp announced plans to buy a 20 percent stake in Tsinghua Unigroup for $1.5 billion.

None of the world's top memory-chip manufacturers are based in China, but two main South Korean players have set up some operations in China: SK Hynix Inc (Wuxi, Jiangsu province) and Samsung Electronics Co (Xi'an, Shaanxi province).

Micron makes most of its chips in US factories, but the company has large wafer-fabrication facilities in Asia, including in Singapore and Taiwan. It has an assembly factory on the Chinese mainland, as well as manufacturing plants and a sales office in Taiwan.

A deal between Micron and Tsinghua Unigroup also would further Xi's goal of making the country more self-sufficient in technology.

The Chinese government is expected to spend as much as 1 trillion yuan ($161 billion) on the semiconductor chip industry over the next five to 10 years, according to estimates from global consulting firm McKinsey & Co.

Cao said the deal could take time even if the US approves it.

Contact the writers at jackfreifelder@chinadailyusa.com and gaoyuan@chinadaily.com.cn