Shares of Unisplendour Technology Holdings Ltd surged by about 120 percent mid-day before the rise narrowed to about 64 percent on Thursday, after it acquired shares in Legend Holdings and Semiconductor Manufacturing International Corp.

The affiliate of China's largest chipmaker Tsinghua Unigroup closed at HK$4.9 (62 cents) per share. The change came after it spent HK$135 million to buy 4.51 million shares in Legend Holdings from last Tuesday to Friday. That accounts for 5 percent of Legend Holdings' total shares, and make Unisplendour its fifth largest shareholder.

"The move is based on financial considerations," said Zhao Weiguo, chairman of Tsinghua Unigroup. "Legend Holdings is undervalued. "

"But we have no plans to apply for a board seat yet, because we think its board of directors and management teams are excellent," Zhao added.

Legend Holdings, founded by well-known Chinese entrepreneur Liu Chuanzhi, has evolved from a computer maker into a diversified investment group. It is the largest shareholder of Lenovo Group Ltd, the biggest computer maker in China. On Thursday, its shares jumped nearly 2.9 percent to HK$35.6 per share.

Legend Holdings said in a statement to China Daily that it "welcomes market investors, who recognize our brand and value, to be our shareholders. At present, the business operations of the company are normal."

Last Friday, Unisplendour also acquired 4.2 million shares in Semiconductor Manufacturing International Corp, also known as SMIC, for around HK$49.4 million. After the deal, Uniplendour owns more than 5 percent of the latter's shares.

Tsinghua Unigroup is championing China's efforts to develop homegrown chips, as part of the country's broad push to reduce reliance on foreign technology. The Beijing-based company became the largest chip firm in China after it acquired Spreadtrum Communications Inc, the world's third-largest mobile phone chipmaker, and RDA Microelectronics Inc, the fourth-largest, in 2013.

It then started an acquisition carnival, looking for targets all over the world, in the hope of joining the ranks of global chip giants such as Intel Corp, Qualcomm Inc and Samsung Electronics Co.

Shen Meng, director of boutique investment bank Chanson & Co, said it was a natural move for Tsinghua Ungroup to partner with Legend Holdings in the chip industry.

"Legend Holdings is the largest shareholder of Lenovo. It is possible to influence Lenovo to use memory chips produced by Tsinghua Unigroup. The two sides can also join hands in overseas investments," Shen said.

Tsinghua Unigroup is working on a $30 billion domestic memory-chip production complex in Nanjing, Jiangsu province, that will become China's largest when completed.