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Chip design software company Synopsys has announced its intention to acquire Ansys in a $35 billion cash-and-stock deal, making it the largest acquisition in the technology sector since Broadcom acquired VMware in November 2023 for $69 billion.
The deal, which implies a per-share value of $390.19, represents a premium of about 29% over Ansys’ last closing price on December 21, 2023.
Synopsys’ move to pursue such a transformative acquisition comes just two weeks after the company’s co-founder and Executive Chairman, Aart de Geus, handed over the CEO role to Chief Operating Officer Sassine Ghazi.
Ansys – Maker of Simulation Software for Diverse Industries:
Ansys specializes in simulation software engineering, design, and research use across various industries, including aerospace, defense, automotive, and energy.
The software aids in the analysis of products, competing with offerings from Autodesk and Dassault Systemes.
Conversely, Synopsys provides semiconductor electronic design automation (EDA) tools used by major chipmakers such as Intel, AMD, and Nvidia.
Commercial Appeal of Ansys’ Software and Strategic Rationale:
The pursuit of Ansys by Synopsys underscores the commercial appeal of Ansys’ simulation and analysis software.
The deal would combine Synopsys’ EDA tools with Ansys’ simulation and analysis portfolio.
The strategic move aims to enhance the capabilities of both companies and potentially drive further growth in the chip design and simulation space.
Synopsys’ Coordinated Efforts and Leadership Transition:
The acquisition announcement came after Synopsys and Ansys began their partnership in 2017 to offer chip designers solutions for analyzing chips and ensuring quality standards.
Synopsys has seen its share price rise significantly over the past year amid the artificial intelligence boom.
The deal is expected to be completed in the first half of 2025, adding to Synopsys’ adjusted earnings within the second full year post-closing.
Termination Fees and Antitrust Considerations:
If the deal is terminated under specific circumstances, including antitrust hurdles, Synopsys must pay Ansys a termination fee of $1.5 billion.
Conversely, if Ansys ends the deal to accept another superior proposal, it must pay Synopsys $950 million.
