Imagination Technologies Announces Collaboration with Intel

Imagination Technologies Announces Expanded Multimedia Collaboration with Intel and Investment from Intel Capital

2 October 2006 - Imagination Technologies Group plc (LSE:IMG; "Imagination") - a leader in System-on-Chip Intellectual Property ("SoC IP") - today announces that it has reached a new major collaboration agreement with Intel Corporation ("Intel"), which extends the licensing and deployment of its graphics and video IP cores for use with Intel's PC, mobile computing and consumer architectures in certain segments.

Imagination also announces an investment by Intel Capital, the venture capital arm of Intel. Intel Capital will invest ?5.28m in Imagination, subscribing for 6,000,000 new ordinary shares of Imagination's share capital (representing 2.9 per cent. of issued share capital prior to such issue) at a price of 88 pence per share, being the closing price on the London Stock Exchange on Friday 29 September 2006.

Arvind Sodhani, President of Intel Capital, says: "Intel Capital's investment recognizes the importance of graphics, video, and display technologies for the PC, mobile computing and consumer markets. This investment together with the ongoing collaboration between Intel and Imagination will expand these capabilities bringing the benefits of enhanced graphics and video to customers around the world."

Anand Chandrasekher, Sr. Vice President, General Manager Ultra Mobile Group - Intel, added: "Imagination has a wide range of significant and market-leading graphics and video IP cores, together with a team of highly respected engineers with many years experience of embedded multimedia. Intel highly values our collaboration with Imagination Technologies in the development of industry-leading multimedia capabilities for future PC and consumer products."

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