Apple has taken a £3m stake in Imagination Technologies, the maker of Pure digital radios and the developer of the Digital Audio Broadcasting standard.
The iPod maker bought up 8.2 million shares in the Hertfordshire-based company, equating to a 3.6 per cent stake. Imagination's share price shot up from a five-year low on the news of the investment, and is currently trading at around 54p.
Apple already licenses other Imagination technology for enhanced onscreen graphics in its portable devices.
The investment has fuelled speculation that Apple may be looking to add digital radio to the iPod, but many see the move as simply deepening the existing relationship between the two companies.
Both firms have had a rocky time in recent weeks. Apple took a hit following the news that Steve Jobs would not be delivering a keynote speech at next month's MacWorld conference.
Imagination, meanwhile, has suffered under concerns about the adoption of digital radio.
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