Canyon Bridge buys Imagination Technologies for GBP 550 mln

Canyon Bridge Capital Partners a Chinese-backed fund made its move for Imagination Technologies after the chipmaker was dropped by Apple and put itself up for sale in June

A forthcoming green paper is expected to set out the Government's thinking on these issues but sources within the City of London believe that this Beijing-backed bid for Imagination‎ could force ministers to extract firm commitments about British technology jobs from Canyon Bridge.

Canyon Bridge recently hit the headlines as the company Donald Trump blocked from buying the US chipmaker Lattice Semiconductor, over perceived national security threats. It manages about $1.5bn on behalf of Yitai Capital.

MediaTek's chips mostly make use of the Mali GPUs supplied by Arm Holdings (ARM), though it has employed Imagination Technologies' PowerVR tech in the past.

That decision knocked 70% off Imagination's stock, leading the company to put itself up for sale.

The deal, valued at £550 million ($742.5 million) or 182 pence per share, is at a premium of over 40 per cent.

At the same time, Imagination announced a new deal with Tallwood MIPS related to MIPS' disposal.

Canyon Bridge, a private investment LLC and a believable codename for an Intel processor architecture, has just reached an agreement with Imagination Technologies to acquire most of their company.

As a result, the Liberum analysts cut their price target for Imagination back to 182p from 193p to reflect the acquisition price. "They and the business as a whole will benefit from Canyon Bridge's investment in Imagination as it moves to the next stage of its development", he added.

Over the weekend news broke that Imagination Technologies had found a buyer for its graphics chip design business. Imagination at the moment is in a legal dispute with Apple over royalties.

Hertfordshire-based Imagination Technologies is a world leader in microchip manufacturing and billions of its chips are powering smartphones, tablets and other devices around the world. The firm listed only the abortive Lattice acquisition and "a minority investment of approximately $10 million in a US-based technology company" among its prior investments.

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