Apple is poised to acquire 2.2 million new shares of Imagination Technologies on July 1 at $2.36 per share. Those shares, together with Apple’s latest purchases on the open market, will boost the iPhone maker’s ownership interest in Imagination to 9.5 percent — up from just 3.6 percent in December.
Apple’s deal follows in the wake of Intel’s announcement that it had upped its stake in Imagination to 16 percent.
Though the U.K.-based company’s intellectual property (IP) for mobile applications has attracted a lot of attention, the current interest in Imagination is about more that just technology, said Jordan Selburn, iSuppli’s principal analyst for semiconductor designs.
“Imagination is also attractive on a business basis,” Selburn said. “In both cases, Apple and Intel looked at the company and thought it was a good investment.”
Commanding More Value
Generally speaking, Imagination plays in the semiconductor arena at a very high level, Selburn observed. “If you look at the IP space in chips, a lot of it is nuts and bolts stuff: Logic gates, memory interfaces, memory generators, and so on, and on a technical basis, there is very little to stop anyone from duplicating that,” Selburn said. But processor cores and high-speed interfaces represent “a bigger part of the end chip and therefore command more value, and that is what Imagination is providing.”
Imagination’s IP covers entire graphics and video systems, very flexible communications interfaces, and processor flows at a very application-focused level, Selburn said. “And if someone wanted to put together a high-level SoC, they could do it almost entirely with Imagination Technologies, which is pretty much alone in the space where they are competing,” Selburn added. “Their high-level IP is the sort of stuff that would have been an entire chip several years ago.”
Although the details are somewhat sketchy about Imagination’s exact…