SOUTH CHINA MORNING POST via NewsEdge Corporation : Comlent Holdings has received US$7 million in a second round of venture capital financing from the investment arm of United States chip giant Intel and other investors.

The Shanghai-based company, which designs radio frequency chips for xiaolingtong handsets and cordless phones, has spent the past two years in research and development and will use the funds to move towards mass production.

"Next year, we should see significant revenue generation," co-founder and chief executive Kai Chen said.

Intel Capital, 3i and other unidentified investors took part in the second round. Comlent has an investment of US$9 million.

The company did not break down how much each venture capital firm contributed.

Comlent plans to reach 60 full-time employees soon, up from 16 at the end of last year, and will hire sales staff to push its chips to mainland handset and cordless phone manufacturers. 3i Asia investment director Cynthia Ng said the venture capital firm liked Comlent's cost-efficiency model.

The company combines as many as six radio frequency chips into one or two chips, thus reducing a handset's overall cost.

With Comlent's chips, the cost of a xiaolingtong handset can be cut from US$30 to $25, while for cordless phones the reduction is by about $3 to $22.

"The company is poised for aggressive growth and we are excited about its prospects," Ms Ng said.

Intel Capital Asia director Cadol Cheung said the investment would give the chip giant exposure to the growing mainland wireless market.

Earlier investors include Tsai Ming-kai, chairman of MediaTek, the world's largest maker of chips for DVD players.

Comlent is one of an estimated 450 chip designers based on the mainland. Its foundry partners are Taiwan Semiconductor Manufacturing and Jazz Semiconductor of the US.