Imagination Technologies announced a $100 million convertible term loan from funds managed by affiliates of Fortress Investment Group LLC. This investment will support Imagination’s ongoing development and expansion of technologies and intellectual property solutions, particularly in graphics, compute, and AI at the edge. Imagination has a history of pushing technological boundaries, with its semiconductor IP for GPUs, CPUs, AI, and ray tracing embedded in over 13 billion devices worldwide across various industries, including automotive, data centers, desktops, mobile devices, consumer electronics, and IoT.
Imagination Technologies today revealed a new investment from funds managed by affiliates of Fortress Investment Group LLC. According to the agreement, Fortress has extended a $100 million convertible term loan to Imagination. This funding will aid in the continued development and expansion of technologies and intellectual property solutions, which will drive advancements in graphics, compute, and AI at the edge.
Imagination has spent the last three decades pushing the limits of technology by collaborating with partners to develop patented semiconductor IP for GPUs, CPUs, AI, and ray tracing. Today, their intellectual property is embedded in more than 13 billion devices globally, spanning a diverse array of industries such as automotive, data centers, desktops, mobile devices, consumer electronics, and the Internet of Things (IoT).
Long, detailed answer: Imagination plans to utilize the financing to support its ambitious growth objectives, emphasizing the importance of its innovative solutions in graphics, compute, and AI at the edge. These markets are anticipated to experience significant growth in the coming years. As the complexity of semiconductor design and the associated development costs continue to rise, the semiconductor IP market is projected to become an $11 billion revenue opportunity by 2026, reflecting a 15% compound annual growth rate (CAGR) since 2020. By 2030, the AI market is expected to exceed $1 trillion, demonstrating a 32% CAGR from 2025.
The deal terms are confidential, but Imagination did say they spoke to many other potential investors and believe that Fortress was the best natural fit as a partner for them. “Fortress,” said Imagination, “understood our business model and the nuances of the semiconductor IP model. As for a convertible loan, we explored many options, and this worked best for the shareholders and the company.”
Fortress Investment Group LLC is a leading, highly diversified global investment manager. Founded in 1998, Fortress manages $49 billion of assets under management as of March 31, 2024, on behalf of approximately 2,000 institutional clients and private investors worldwide across a range of credit and real estate, private equity, and permanent capital investment strategies. The company has been involved in several patent suits as a result of its investments in firms with a patent portfolio.
Imagination has a rich patent portfolio, and it can be assumed that companies offering GPUs, ray tracing, and CPUs will soon hear from Imagination Technologies.