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Imagination Technologies to Sell MIPS, who is going to buy it?

Daniel Nenni

Daniel Nenni

Admin
Staff member
According to multiple reports IMG is putting their MIPS unit up for sale to salvage the company (MIPS was purchased for $100M in 2013). I'm still digging in but it will be interesting to see what they get for it. If you have some ideas let me know via SemiWiki email or you can get me on LinkedIn.

The MIPS acquisition was interesting because of the patents. IMG paid $100M and got 82 patents related to the MIPS architecture and the other 482 patents were acquired by Bridge Crossing LLC and ARM for $350M. I remember Bridge Crossing putting the patents up for auction but I don't know what happened after that. Does anyone know who owns the other 482 patents?

As for a list of potential buyers, I have three candidates: Synopsys, Cadence, and CEVA. IMG outbid CEVA for MIPS the first time around so maybe CEVA will play clean-up here. CEVA is having a great financial run so they definitely are in the game. Synopsys and Cadence of course. Synopsys has the ARC product they inherited from the Virage acquisition and have done quite well with it so they definitely have the channel. Cadence has the Tensilica DSP business and a new IP VP so I definitely put them in the running.

Anybody else?
 
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Maybe Apple or Samsung. Apple is on a mission to cut royalties - ARM has to fit somewhere along that trajectory. Same could be said for Samsung.
 
Does Imagination's decision to monetize MIPS and Ensigma, suggest they believe they will eventually prevail in their GPU fight with Apple? They could have sold the GPU business, and kept the growing MIPS segment, if they felt otherwise.
 
Who could acquire MIPS?

At first, MIPS business is declining, not growing:
[table]
|-
| style="width: 46pt; height: 15.0pt" |
| style="width: 46pt" | 2016
| style="width: 46pt" | 2015
|- style="height: 15.0pt"
| style="height: 15.0pt" | Lic
| 12,4
| 14,1
|- style="height: 15.0pt"
| style="height: 15.0pt" | Roy
| 34,7
| 38,2
|- style="height: 15.0pt"
| style="height: 15.0pt" | Total
| 47,1
| 52,4
|-
[/table]



Both license revenues (-12%) and royalties (-9%) are going down on a YoY basis... not very good sign, when ARM royalty business is growing by 26% !!

I don't know the rationale behind this, but MIPS business is cursed... anyway, if we look at the potential buyers:

- Synopsys? The company has completely rebuilt ARC CPU IP into a very dynamic product line, so why would they make life more complicated to their sales people by adding another CPU?

- Cadence? OK, Tensilica is more a DSP than a CPU, but buying and developing MIPS business could put Cadence at risk in respect with ARM (for the other EDA businesses)... Not impossible, but doubtful.

- CEVA? The vendor is doing very well with their DSP (and wireless) IP business, with 20% growth in 2016. Buying MIPS could make sense...

- I would add another name: initially a design service company linked with SMIC, Verisilicon has radically changed their strategy (in respect with SMIC) and is quietly becoming a successful IP vendor. If we limit to the processor IP cores in Verisilicon portfolio:

- DSP: ZSP acquisition from LSI Logic in in 2006
- GPU: acquisition of Vivante in Jan 2016
- the company will probably not wait until 2026 to buy a CPU IP company...

As far as I am concerned, I vote for Verisilicon!
 
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