Apple said on Tuesday it was in “advanced talks” about acquiring its supplier British graphics chip designer Imagination Technologies, but did not plan to make an offer at the moment.

Imagination, which counts Apple amongst its top shareholdersm traditionally supplies the PowerVR graphics architecture found in Apple’s range of iPhones and iPads. Apple has been a licensee and stakeholder in the company since at least 2008, and became a key investor in mid-2009 when it raised its stake in the firm to 10 percent.In 2014, Imagination announced an extended licensing agreement with Apple.

Imagination Technologies currently has a market capitalization of around £500 million ($714.5 million). The acquisition, if confirmed, would likely mean Apple could design future graphics architecture for its iOS devices in-house.

“From time to time, Apple talks with companies about potential acquisitions. We had some discussions with Imagination, but we do not plan to make an offer for the company at this time,” the U.S. company said in subsequent a statement.

“We had some discussions with Imagination, but we do not plan to make an offer for the company at this time.”

Imagination has struggled to reduce its reliance on Apple and last month announced the departure of veteran chief executive Hossein Yassaie after 18 years in the job, along with a profit warning and restructuring plan.

Its shares, which have slumped from a high of 705 pence nearly four years ago, were up 5.7 percent at 195.50 pence at 1625 GMT on Tuesday, valuing the company at 528 million pounds ($750 million).

Earlier in the day the shares had jumped more than 20 percent on the report of interest from Apple, after website Ars Technica UK said Apple was in talks to buy the company.

Broker Aviate said a deal would make strategic sense, allowing Apple to optimize the efficiency and power consumption of its devices.
Meanwhile Credit Suisse commented on the possible impact on the company of the new Apple iPhone SE, saying: “While we see Apple launch as a positive for Imagination, we still model small decline in Imagination’s GPU units globally (475m in 2016 declining to 455m in 208) which is driven by continued share loss.. as Arm continues to penetrate into the high end with recent launches like Helio X20/X25 and P10/P20.”