Apple's former GPU maker Imagination agrees to £550 million sale

Yolanda Curtis
September 25, 2017

The British tech industry giant, Imagination Technologies Group, has agreed to a sale to the Chinese-funded private equity firm Canyon Bridge.

As part of the deal, Imagination will sell its US -based embedded processor unit MIPS to Tallwood MIPS, a company indirectly owned by California-based investment firm Tallwood Venture Capital, Canyon Bridge said.

Andrew Heath CEO of
Imagination Technologies Group plc
Andrew Heath CEO of Imagination Technologies Group plc

Canyon Bridge, whose planned purchase of a U.S. semiconductor firm was scuttled earlier this month, said on Friday that it will buy Imagination Technologies in an all-cash deal, the Wall Street Journal reports.

Canyon Bridge was keen to structure a bid to avoid scrutiny from USA regulators, Bloomberg reported earlier this month. Canyon Bridge Capital Partners is a much newer company that was recently prohibited from acquiring FPGA company Lattice Semiconductor US President Donald Trump because of its Chinese associations (see President Trump blocks Lattice deal). "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", Heath said.

Imagination said that it believed the deal provides shareholders with a very good outcome and provides certainty at a time when its future had been "negatively impacted" by the actions of major customer Apple Inc. It does not sell chips to the United States military, but its two biggest rivals - Xilinx and Intel's Altera - make chips that are used in military technology. Imagination Technologies has been slowly rebuilding its value in the months since, with the biggest increase in value being back in June when the company announced it was putting itself up for sale.

Imagination's shares plunged more than 60 per cent in April after Apple's announcement.

At 182p, Imagination is being valued at £550 million. Imagination employs a large number of hugely talented individuals who have developed our market leading technology.

That said, it is now unclear what either company, Canyon Bridge Capital Partners or Tallwood Venture Capital, wants to do with Imagination Technologies or MIPS Technologies, Inc., respectively.

Canyon Bridge manages about $1.5 billion, according to a statement Friday.

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