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China-backed PE firm eyes UK tech company dropped by Apple
Canyon Bridge Capital Partners is interested in acquiring UK tech company Imagination Technologies after it was dropped as a supplier by Apple.
Michael Marray 1 Aug 2017

Canyon Bridge Capital Partners is interested in acquiring UK tech company Imagination Technologies after it was dropped as a supplier by Apple. Imagination's graphics processors are widely used in smartphones.

Imagination began to look for a buyer of all or part of its shares after Apple announced that it would no longer be using it as a supplier, and use its own in-house technology instead. The announcement from Apple in June led to a sharp drop in Imagination's shares.

In late June Imagination initiated a formal sales process for the entire group, assisted by Rothschild. The company said at the time that it remained in dispute with Apple.

According to reports, Canyon Bridge held talks with Imagine about a potential bid for all or part of the business.

Several companies are interested in Imagination after the technology company revealed it was still making profits.

Chinese takeovers of high-tech companies in the UK and across Europe are a sensitive topic at present, but if Imagination is seen to need the support of a strong new owner then this could soften the stance of the UK authorities. As it struggles to make progress in talks with the European Union over the terms of Brexit, the UK government is anxious to keep the economy moving, and is less likely to block Chinese takeovers than countries such as the US and Germany.

The low value of the pound, in the wake of the June 2016 Brexit vote, is currently making UK acquisitions attractive. The pound was above US$1.47 just prior to the Brexit vote, but is now trading at just over US$1.30.

Already last year Canyon Bridge announced the acquisition of US chip manufacturer Lattice Semiconductor for US$1.3 billion. This deal is awaiting final regulatory clearance. It could yet be blocked by the powerful Committee on Foreign Investment (CFIUS) on national security grounds.

Photo: imgtec.com

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