Design & Reuse

China shows it takes Imagination opportunity seriously

Apr. 11, 2018 – 

The appointment of Leo Li as the next CEO of intellectual property licensor Imagination Technologies Ltd. (Kings Langley, England) demonstrates to me that China takes seriously the investment of £550 million in cash (about $740 million), made in the company last year.

It also pushes into sharp relief whether Japan's Softbank Group sees its own $30 billion investment in ARM Ltd. in the same light. There is a sense that Softbank – with its plans to move a portion of ARM into the Vision Fund and talk of re-listing ARM – sees it as not only an investment opportunity but also as a cash cow to be milked and moved around for maximum financial leverage. There is a risk that conflicts or confusion could occur from holding both positions at the same time.

The much smaller, and much more marginally profitable, Imagination is privately owned by US based private equity firm Canyon Bridge Capital Partners LLC (Palo, Alto, Calif.). But with the money coming to that firm from Chinese sources, essentially the Chinese state, it is not surprising that Leo Li, co-president at Tsinghua Unigroup, has been drafted in to manage that investment .

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