Canyon Bridge Capital is Considering Acquiring UK-based Semiconductor Manufacturer Imagination Technologies

Canyon Bridge Capital is reportedly considering acquiring UK-based semiconductor manufacturer Imagination Technologies.  Corporate filings in China show that the funding behind Canyon Bridge originates from the State Council, while the buyout fund also has connections to China’s space program.

A formal approach to Imagination Technologies would be an astute financial move, given the 70% fall in the semiconductor company’s share value after the cancellation of a contract with Apple.  Such an acquisition, however, may also indicate a hedging strategy by Canyon Bridge with regard to its bid for Oregon-based semiconductor manufacturer Lattice, which has faced considerable difficulty in its CFIUS investment review process.  Chinese companies have been aggressively pursuing semiconductor manufacturing companies globally — particularly in the United States — in recent years as part of a push for domestic capability in this area.

The Palo Alto-based fund may need to move quickly: the UK government is beginning work on putting together an institutionalized investment review process, similar to that of CFIUS.  The move in this direction was, in part, stimulated by Prime Minister May’s re-opening of a process for scrutinizing the security concerns after the Hinkley Point C nuclear power plant project.