China’s state-owned Tsinghua Unigroup has prepared a $23 billion takeover offer for Micron Technology, but any deal for the memory chip maker is likely to face significant regulatory hurdles in the U.S., The Wall Street Journal reports.

If the acquisition goes through, it could be the largest foreign takeover by a Chinese firm. Tsinghau, China’s chip design company, said it is willing to pay $21 a share for Micron, a 19.3% premium over Micron’s Monday closing price, the WSJ said, citing people familiar with the matter.

The Chinese government has been seeking to expand domestic production of semiconductors. “They have decided that they really have to buy somebody because they can’t deliver the intellectual property themselves,” Handel Jones, president of the Silicon Valley consultancy International Business Strategies, told the WSJ.

But according to Jones, a big question mark is whether the U.S. government would allow a foreign company to buy a supplier of such strategic components. The deal would be would be subject to U.S. review, including before the Treasury Department’s Committee on Foreign Investment in the U.S. (CFIUS).

“I think they’re going to have a really hard time,” James Lewis, a security expert with the Center for Strategic and International Studies, told CNBC. “CFIUS is always suspicious of state-owned enterprises. That would be a huge obstacle.”

He added that the Pentagon has “always been uncomfortable with technology transfers to China’s microelectronics industry. It’s not like the Chinese have done us any favors recently. I think what’s a factor is U.S. companies are being treated unfairly in China.”

Tsinghau may have timed its bid opportunistically, however, with Micron’s shares about a third cheaper than several months ago. Micron closed Tuesday up more than 10% at $19.64.

“They’re saying: ‘The market’s hammered the stock. This is an asset we want. If we get this through, it would be a home run for us,'” Timothy Arcuri, an analyst at Cowen, said, adding that Intel and private equity firms might also be interested in making a run at Micron.

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