Acquisition talks between Apple and PowerVR maker are ‘advanced’ – update

Apple and Imagination Technologies, the maker of the PowerVR GPU used in Apple computers, are in talks about a possible acquisition by Apple. The company already owns a stake in Imagination Technologies, but a full acquisition would now be close.

Ars Technica sources with knowledge of the talks confirm that they are at an advanced stage. Imagination Technologies would further refuse to deny reports of a possible acquisition. Apple uses the British company’s PowerVR GPUs in its SOCs from the A4, which was present in the iPhone 4, among other things.

With a full takeover of the company, Apple could design the GPUs itself, making it less dependent on others for an important part of its devices. There is currently a lot of contact between the companies to ensure that the GPUs work well with other components.

In the past, the British company has supplied GPUs to companies such as Samsung, Texas Instruments, MediaTek and Intel. However, many of the companies have now switched to other products. For example, Samsung and MediaTek opted for the Mali GPU from ARM and Intel recently started using its own HD Graphics for Atom-socs.

Apple acquired a stake in Imagination Technologies in 2008, when it bought 3.6 percent of the company with 8.2 million shares. In 2009, Apple increased its share to 9.5 percent. Imagination Technologies is currently undergoing restructuring, with 350 employees having been laid off and the CEO resigning. The company then announced that it would focus entirely on PowerVR.

Update, 16.35: Apple states in a message that talks have been held, but that there are currently no plans to acquire Imagination Technologies.