Economy

Canyon Bridge says aims to complete Imagination deal despite insider trading case

Imagination Technologies (IMG.L) shareholders approved a 550 million pound ($730 million) cash takeover by China-backed Canyon Bridge on Tuesday, a day after the buyout firm's founder was charged by US authorities with insider trading.

The Acting United States Attorney for the Southern District of NY and the Federal Bureau of Investigation alleged on Monday that Chow had conspired to commit securities fraud by sending information regarding the Lattice bid to an unnamed friend and former colleague.

Benjamin Chow, who founded Canyon Bridge Capital Partners a year ago, was indicted Monday in Manhattan federal court on conspiracy to commit securities fraud and securities fraud charges, according to the U.S. Department of Justice.

A separate indictment by the U.S. Securities and Exchange Commission in February against that former colleague of Chow identified him as Michael Yin, a former Hong Kong-based private equity executive who had become a hedge fund manager.

On Monday, federal prosecutors for the Southern District of NY charged Chow, 46, with securities fraud connected to a $5 million insider-trading scheme related to the deal.

Authorities accuse Chow of tipping off a friend about the potential acquisition by Canyon Bridge of Lattice prior to that information being made public.

"Benjamin Chow is a true American success story, and the charges against him are baseless and unprecedented".

A spokesman for Canyon Bridge said, "We are aware of the indictment charging Mr. Chow with violations of USA securities laws". A lawyer for Mr Yin did not immediately respond to requests for comment.

Canyon Bridge Capital Partners was founded in 2016 with backing from China Reform Holdings, a Chinese state-backed investment fund with ties to the upper levels of China's government.

Canyon Bridge offered $8.30 a share for Lattice.

Another Canyon Bridge partner, Ray Bingham, has also faced problems.

A court hearing to approve the Imagination takeover, which was agreed only days after the Committee on Foreign Investment in the United States rejected Canyon's proposed $1.3 billion acquisition of Lattice, is expected to be held on November 6. Bingham could not be reached for comment Monday.



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