A Japanese government-backed fund will sell part of its stake in Renesas Electronics, giving the leading chipmaker more business options amid intensifying global competition in the semiconductor industry.

The fund, Innovation Network Corporation of Japan, became the ailing company's top shareholder 5 years ago as part of a corporate rescue effort.

The fund announced on Tuesday that it would unload nearly 12 percent of the company's shares on the market, signaling that Renesas is back on track.

This will leave the fund holding a little more than 33 percent of Renesas shares, down from its current 45.6 percent. That's still enough to retain veto rights on crucial proposals, but gives more leeway to the chipmaker.

Mergers and acquisitions are increasing in the global semiconductor industry as makers look to gain an upper hand in new markets such as self-driving technologies.

Integrate circuit for cars are Renesas’ main product. The company plans to expand its global operations with acquisitions and tie-ups.