British GPU and AI processing company Imagination Technologies has reportedly been put up for sale by its current owner, Canyon Bridge Capital Partners. According to a Bloomberg report, Canyon Bridge tapped financial advisory and asset management firm Lazard Inc. to find a buyer, and the latter has already received some inquiries about the company. The private equity fund hopes to recoup the GBP 550 million (approximately $690 million today) investment it made to purchase the chipmaker in 2017.
Imagination hit its peak in 2012, in terms of valuation, when it was worth nearly GBP 2 billion. However, it put itself up for sale some five years later, after one of its biggest partners, Apple Inc., said that it would stop using the company for its graphics chips in the iPhone and its other products by 2019. This was when Canyon Bridge snapped up the company at a discount, and now it’s offering it for sale after eight years, which is about the end of its fixed term.
Although it no longer sells its chips to Apple, Imagination still has some prominent customers, like Texas Instruments and MediaTek, which primarily uses Imagination’s tech for in-car chips. Google is also reportedly Imagination’s customer, helping it build its Android GPU Inspector tool. However, a research paper released in December by UK-China Transparency, a charitable incorporated organization, asserts that Chinese companies have pillaged Imagination Technologies’ intellectual properties to advance their domestic chip development.
According to the UKCT report (PDF), Canyon Bridge is backed by state-owned China Reform Fund Management. It is accused of allowing some of Imagination’s core assets to be transferred to Chinese chip makers Moore Threads, Innosilicon, and Biren Technology. It was also widely reported that China Reform attempted to take over Imagination’s governance in 2020 through an emergency board meeting. This meeting was supposedly set to appoint four nominees set by the Chinese fund as directors but was canceled after receiving significant backlash from the British government and the public.
However, Imagination has denied any wrongdoing, with the company saying that it has always complied with regulations and adhered to industry standards. It also said that it would not make any sense at all for the company to sell its core expertise and allow its customers to build their own GPUs. But whatever the case, Canyon Bridge believes that it can sell Imagination Technologies for a handsome sum. The former believes that Nvidia’s massive increase in market capitalization could also translate into a strong interest in Imagination Technologies.
