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Hannah Boland 27 April 2020 5:00am BST As a rule, Sir Hossein Yassaie has tried not to air his views on Imagination Technologies since stepping down as CEO four years ago. When the British
chip developer lost Apple as a customer in 2017, Sir Hossein, the man who had engineered the deal, said nothing. When Imagination put itself up for sale, something Sir Hossein had previously
rallied against, he remained quiet. But, the 63-year-old cannot be silent this time. The semiconductor veteran may have moved on to new ventures, with a portfolio of innovative start-ups,
but an effort by Imagination’s Chinese owners to seize control of the board was something he felt “needed to be talked about”. Earlier this month, private equity firm Canyon Bridge, which
bought Imagination in 2017, tried to appoint four new directors to the board, doubling its size. All were representatives of its main backer Chinese government investment fund, China Reform
Holdings. Speaking from his home in Buckinghamshire, Iranian-born Sir Hossein says it seemed to him that the “current owners of Imagination could be using all the mayhem of the coronavirus
situation to change the structure of the company”. He wrote to MPs saying as much. After all, Imagination develops key technology used across many industries, he says. It should be
protected. Technology Intelligence newsletter - UK But, it feels more personal than that. Sir Hossein had acted as Imagination's CEO for 18 years. This is a company which he, in his
own words, helped build into a “huge success”, which under him grew to skim a valuation of £2bn by creating some of the world’s best graphics chips. Yet Imagination is in a different
position now. Its chips may still be used in a third of the world’s mobile phones, but even by the time Sir Hossein left, it had lost some of its sheen, with losses spiralling as the phone
market slumped amid its market capitalisation slipping to just £350m. The real turning point came in 2017 when Apple cut ties with the firm - ending business which had accounted for half of
Imagination’s sales of graphics chips. It was a heavy blow, one which sent its share price tumbling and which ultimately resulted in it being acquired by Beijing-backed Canyon Bridge.
Initially, there had been questions over what this takeover meant. But those soon dissipated. That was until earlier this month, when the planned board appointments prompted a public
backlash, and boss Ron Black threatened to quit. Ultimately, the appointments were pulled. “It had,” Sir Hossein explains, “seemed like everything had gone back to normal.” Just days later,
however, Imagination announced that Black would be leaving. Canyon Bridge’s Ray Bingham, already chairman of Imagination, would become its interim CEO. Sir Hossein says there are questions
that need answering. In a recent post on LinkedIn, he suggested Black’s exit was engineered by Imagination’s owners. Imagination has said it would not discuss private discussions. Whatever
happened, letting Black go was “completely wrong”, he says. “I know that was not in the spirit of discussions with government ministers. That needs to be investigated.” Sir Hossein Yassaie
and Imagination Technologies: Ups and downs Calls for scrutiny mirror recent noise from politicians, who have warned over Beijing’s tightening grip on the business. They have said state
entities could use technology developed by the business to find so-called “backdoors” in networks and gain access to secure systems. It is not that Chinese entities should be singled out,
and actually, he says, “I personally believe we should be welcoming international investment and international collaboration”. He is keen to stress he is not a “Huawei-basher”. “I’m not one
of those people who says just because a company is Chinese we should worry. I’m a techie, I understand it is possible to use technology from anyone and make sure it doesn’t undermine our
national interest.” But, while he welcomes international involvement in the UK, he says there needs to be “sufficient rules around what happens to make sure UK headquartered companies are
encouraged”. “We need to make sure wherever there are national interests or customer issues, the company is looked after,” Sir Hossein says. “When a British company is acquired fully or
partly, by anyone, that it’s still governed according to UK governance rules.” The US agency for scrutinising deals, the Committee on Foreign Investment in the United States, is one
blueprint for how this could be done. “I don’t recommend that though,” Sir Hossein says. “It’s a very difficult, intrusive system. I don’t think we need to go that far, but we do need to
have a proper process in the UK, when companies get acquired or invested in in a majority way, there’s a degree of checking. “Whatever is the basis for agreeing the deal, those commitments
need to be honoured and checked.”