Apple Chip Designer Imagination Considers London IPO

(Bloomberg) -- Imagination Technologies Ltd., the British semiconductor designer with ties to a Chinese state investor, is exploring options including a potential initial public offering in London, people familiar with the matter said.

The Hertfordshire, England-based company is working with Lazard Ltd. to study strategic alternatives, according to the people, who asked not to be identified because the information is private. Imagination Technologies could also consider a sale, one of the people said. 

Imagination Technologies is owned by China-backed private equity firm Canyon Bridge Capital Partners. It will add more advisers later if it decides to proceed with a share sale, the people said. Deliberations are in the early stages, and there’s no certainty they will lead to a transaction, the people said. 

Representatives for Imagination Technologies and Lazard declined to comment, while a spokesperson for Canyon Bridge couldn’t be reached for comment. 

Imagination Technologies, which licenses its designs to Apple Inc., came under scrutiny last year over its relationship with China Reform Fund Management, the state-owned asset manager that backs its private equity owner. A plan to put representatives from China Reform on Imagination’s board resulted in a backlash and the resignation of Chief Executive Officer Ron Black. 

After the proposal was ultimately withdrawn, the U.K. Parliament’s Foreign Affairs Committee asked interim CEO Ray Bingham to appear to reassure lawmakers that the move wasn’t part of a plan to shift the company’s technology to China. 

Canyon Bridge, with offices in California and Beijing, acquired Imagination in 2017 for about 550 million pounds ($763 million) with a fund that was almost entirely provided by China Reform. 

The sale followed Apple’s announcement that year that it would wind down its agreement with Imagination, sending the stock plunging. At the time, Apple accounted for more than half of Imagination’s revenue. Imagination renewed its licensing agreement with Apple in January 2020. 

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