BEIJING - American semiconductor company Qualcomm Inc will invest $280 million on a computer chip production line together with two Chinese partners, they announced Wednesday.

Semiconductor Manufacturing International Corp (SMIC), China Integrated Circuit Industry Investment Fund Co Ltd (CICIIF), and Qualcomm announced the signing of a non-legally binding term sheet regarding investment in SJ Semiconductor Corp (SJsemi) at a press conference in Beijing.

The funds raised by SJsemi will be used to expedite the establishment of China's first 12-inch bumping production line, which will improve China's overall chip manufacturing capabilities.

Located in Jiangyin, Jiangsu province, SJsemi was founded in August 2014 through a joint venture between SMIC and Jiangsu Changjiang Electronics Technology Co Ltd (JCET).

The joint collaboration will improve the overall level of China's integrated circuit (IC) manufacture industry and increase its competitiveness, said Ding Wenwu, general manager of CICIIF.

SMIC is one of the leading semiconductor foundries in the world and the largest and most advanced foundry in the Chinese mainland.

CICIIF was established by a number of large-sized Chinese companies in September 2014 and focuses on investment in the IC industry.