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

The headquarters of Imagination Technologies is seen on the outskirts of London.

A Chinese group that was stopped by Donald Trump from buying a U.S. chip-maker last week has announced a £550m takeover of British chip designer Imagination Technologies.

United Kingdom technology firm Imagination, which designs graphics chips for smartphones, is being bought for £550m by a Chinese-backed investment firm.

Canyon Bridge previously agreed to acquire Lattice Semiconductor Corp.

Canyon Bridge said on Friday it had agreed to pay 182 British pence per Imagination share, a near 42 percent premium to Imagination’s closing price on Friday. On Sept. 13, President Donald Trump issued an order blocking the deal following the recommendation of the Committee on Foreign Investment in the US, an interagency panel led by the Treasury Department.

Canyon Bridge recently raised $1.5bn (£1.1bn) from Chinese investors and has offices in Beijing and San Francisco. The funds are being provided by initial anchor partner Yitai Capital Ltd., a Chinese state-owned enterprise, according to details provided by Imagination and Canyon Bridge.

Imagination makes graphics that power the iPhone, and licenses video-processing and graphics technology to companies in the semi-conductor industry. Shares in Imagination crashed 70% in April when Apple, its biggest customer, said it would stop using its graphics technology in its new products.

The two firms are still engaged in a dispute over the move – with Imagination questioning Apple’s “assertions” that it would be able to develop its own computer chip designs without breaching Imagination’s intellectual property rights. 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.

Following the decision by Trump to bar the sale of Lattice to Canyon Bridge, the US secretary of treasury Steven Mnuchin said Trump’s move reflected the concerns about intellectual property transfer, the role of Beijing in the deal, the importance of integrity in the supply chain for semiconductors to the government of the USA and the use of products at Lattice by the US government.

Canyon Bridge’s investment focus complements China’s efforts to move its manufacturers up the value chain and create innovative and competitive global conglomerates.

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