China-backed PE firm Canyon Bridge ready to bid for UK’s Imagination Tech

Photographer: Tomohiro Ohsumi/Bloomberg

China-backed private equity firm Canyon Bridge Capital Partners is close to making an offer for Britain’s Imagination Technologies Group Plc that would exclude the troubled chip-maker’s U.S. business, according to people familiar with the discussions.

Canyon Bridge, which says it’s based in Silicon Valley with an office in Beijing, is keen to structure a bid to avoid scrutiny from U.S. regulators, said the people, who asked not to be identified because the matter is private. The company’s $1.3 billion purchase of Portland, Oregon-based Lattice Semiconductor Corp., whose programmable logic chips are used in military communications, is being opposed by U.S. national security officials, and President Donald Trump is considering whether to block the deal.

Imagination has drawn preliminary interest from several parties, the people said. SoftBank Group Corp.’s ARM Holdings Plc and chip designer Rambus Inc. are among those looking at the company and considering bids, the people said. Some potential bidders may only be interested in parts and could decide against bidding, they said.

Representatives of Canyon Bridge, Imagination, ARM and Rambus declined to comment.

“We’re exploring all sorts of different kinds of M&A right now,” Rambus Chief Financial Officer Rahul Mathur said during an earnings call in May. Rambus, based in Sunnyvale, California was also working with a financial adviser to evaluate its own sale options, people familiar with the matter said in July.

Apple Loss

A sale of Imagination would be a test for the British government, which has pledged to tighten the rules that govern takeovers by foreign companies. Canyon Bridge would attempt to gain informal approval from the U.K. by making commitments to bolster Imagination’s local workforce, a person familiar with the matter said.

Imagination said in June that it was initiating a formal sale process. The company initiated the sale after announcing that Apple Inc., which accounts for more than half of its sales, would no longer use its graphics technology. Imagination’s shares have dropped more than 45 percent this year.

Sky reported last month that Canyon Bridge hired Citigroup Inc. to work on formal bid.

Apple owned 8.1 percent of Imagination as of June 28, according to data compiled by Bloomberg.

Before putting the entire company on the market, Imagination said in May that it would sell its WiFi tech business Ensigma and its MIPS unit, which it acquired in 2013 for $100 million. Clients for the company’s MIPS products, which are used in network infrastructure, include Qualcomm Inc., MediaTek Inc., Broadcom Ltd. and Cavium Inc.

Also read:

US chip-maker buyer Canyon Bridge Capital backed by Chinese govt funds

Lattice Semiconductor to be bought by China-backed Canyon Bridge

Bloomberg

Singapore Reporter/s

In Singapore, we are looking to double our reporting team by this year-end to comprehensively cover the fast-moving world of funded startups and VC, PE & M&A deals. We want reporters who can tell our readers what is really happening in these sectors and why it matters to markets, companies and consumers. The ability to write precisely and urgently is crucial for these roles. Ideal candidates must have to ability to work in a collaborative, dynamic, and fast-changing environment. We want our new hires to be digitally savvy and ready to experiment with new forms of storytelling. Most importantly, we are looking for hard-hitting reporters who work well in a team. Collaboration and collegiality are a must.

Following vacancies can be applied for (only in Singapore).

Following vacancies can be applied for (only in Singapore).   

  • A reporter to track companies/startups that have raised private capital, and have the potential to become unicorns. SEA currently has over 40 companies with a valuation of over $100 million and under $1 billion.
  • A reporter who can get behind the scenes and reveal how funding rounds are put together, or why they’ve failed to materialise. She/he in this role will largely focus on long-format stories. 
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Singapore Reporter/s

In Singapore, we are looking to double our reporting team by this year-end to comprehensively cover the fast-moving world of funded startups and VC, PE & M&A deals. We want reporters who can tell our readers what is really happening in these sectors and why it matters to markets, companies and consumers. The ability to write precisely and urgently is crucial for these roles. Ideal candidates must have to ability to work in a collaborative, dynamic, and fast-changing environment. We want our new hires to be digitally savvy and ready to experiment with new forms of storytelling. Most importantly, we are looking for hard-hitting reporters who work well in a team. Collaboration and collegiality are a must.

Following vacancies can be applied for (only in Singapore).

Following vacancies can be applied for (only in Singapore).   

  • A reporter to track companies/startups that have raised private capital, and have the potential to become unicorns. SEA currently has over 40 companies with a valuation of over $100 million and under $1 billion.
  • A reporter who can get behind the scenes and reveal how funding rounds are put together, or why they’ve failed to materialise. She/he in this role will largely focus on long-format stories. 
  • A journalist to track special situations funds, distressed debt and private credit (from the PE angle) across Asia.