May 4, 2017

Imagination Tech offloads businesses in scramble after hit from Apple

Chip designer Imagination Technologies has announced plans to sell two of its businesses in a desperate effort to raise cash after Apple, its biggest customer, said last month that it would no longer use the UK chip designer's technology in new products. The Hertfordshire-based company said it planned to dispose of its MIPS and Ensigma divisions in order to "Strengthen Imagination's balance sheet." Imagination is hunting for a cash boost after Apple announced it would design its own graphics chips for future iPhones and iPads, and reduce its reliance on the British company over the next 15 to 24 months. Apple accounts for roughly half of Imagination's annual revenues, and is one of its largest shareholders, with a 9.5 per cent stake in the company. Last September, the group offloaded its Pure digital radio division for £2.6m. Imagination also announced on Wednesday that it had been "Unable to make satisfactory progress with Apple to date" regarding finding alternative commercial arrangements for the current license and royalty agreements, and that it had therefore commenced a dispute resolution procedure.

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