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Imagination Technology - IP licenced by Sharp & director purchases

February 2003

Investing in shares may lose you all or some of your money. Past performance is no indication of future performance. Some of the shares recommended here may be small company shares, which can be relatively illiquid and hard to trade and this makes such shares more risky than other investments.

Sharp has licenced all three of Imagination's families of IP cores. This includes Metagence, Ensigma and PowerVR. The announcement (short, without much embellishment because of non disclosure agreements) said that the cores will be "used in products targeting the consumer market."   No financials were given but in a recent Buynote, Evolution Beeson Gregory suggest this is worth between US$6-8mof which 30-40% has been paid upfront. The broker expects anotherlarge contract, possibly with the likes of Nokia or Motorola, and thiswould be sufficient to justify a 30p share price. Fivedirectors bought a total of 250,000 shares at 17p over the month.Although not knowing the amount paid upfront by Sharp, the news haseas ...

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With small companies there is an above average degree of risk compared to buying blue chips. Please be aware that we have not assessed the suitability of any of these investments for you. The newsletter simply states a personal view and diarises the editor’s investment decisions. Please speak to your stockbroker or other qualified individual to ascertain whether any of these companies mentioned would form useful additions to your own portfolios. Past performance is no indication of future success.

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