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Synopsys, Ansys in merger talks: WSJ

Daniel Nenni

Admin
Staff member
Synopsys, Ansys in merger talks: WSJ


Synopsys (SNPS) is in talk with Ansys (ANSS) about acquiring the company, according to a report from The Wall Street Journal. The Journal reports that the design-software companies could reach a deal in early 2024, though the outlet's source cautions there is potential for the talks to fall apart. Synopsys declined to comment on "the rumor and speculation."

JOSH LIPTON: Synopsys reportedly is in talks to acquire Ansys, that's according to the "Wall Street Journal." Ansys currently has a market value of about $30 billion The deal with Synopsys could be struck early in 2024. So this one is interesting, again, Jared--

JARED BLIKRE: Yes.

JOSH LIPTON: --coming from the Journal. It would mean, if it happens, a big new design software giant. Ansys market about $30 billion did per the Journal about $2 billion in 2022, in terms of timeline could happen as early as next year.

So some pretty big deal making perhaps to kick off the new year. We just spoke with Teneo's CEO on the show. And they surveyed execs and found that most do expect a pickup in M&A next year.

On the one hand, we're talking about how it's still kind of a relatively tough regulatory backdrop, Lina Khan, the FTC. On the other hand, financing costs coming down. So maybe the first signs here of what they were surveying.

Synopsys, by the way, strong run this year, up about 70%. Analysts are fans. 14 buys, 2 holds, 1 sell. Its customers don't hurt names, like NVIDIA and AMD among others.

JARED BLIKRE: Yeah, it's a fairly big company too. And by the way, just this story broke earlier today. We didn't know the suitor who was going to buy Ansys, but there was a Bloomberg report that was circulating this. So we actually have analysts' commentary from earlier in the day who did not have the privilege of knowing who the suitor would be.

But here's Bloomberg Intelligence saying, with the largest market share of the simulation software market at 42%, Ansys is an attractive M&A target. KeyBanc, which holds it a sector weight, analyst is saying that Synopsys may be the most-- Synopsys, so that's the eventual suitor, just guessing there, may make the most strategic sense in terms of a potential buyer of Ansys given the two companies have shared opportunities and overlap in 3D IC. However, Synopsys may not have the cash, means for the $28 billion, because this is not a cheap company.

If we go to the Wi-Fi interactive, I'll show you Synopsys right here. This has a market cap of $80 billion. I'm circling that right now. Well, you move down to Ansys, $31 billion. That's a big difference.

JOSH LIPTON: Yeah, it sure is. And Synopsys, by the way, we should mention, declined to comment on the rumor and speculation. But the story, of course, we will continue to cover here.



 
Yes there are rumblings, yes it would be disruptive, no it is not confirmed, yes it would make complete sense. Synopsys and Ansys are closely partnered already and do not have a lot of overlap.

JOSH LIPTON: Yeah, it sure is. And Synopsys, by the way, we should mention, declined to comment on the rumor and speculation. But the story, of course, we will continue to cover here.

What a shock? No comment from Synopsys or Ansys?
 
Siemens maybe buy altair soon

I have not heard that. Altair would be a great acquisition. Siemens really is aggressive in EDA M&A. They have bought companies I know and have done VERY well. Solido and Fractal to name two. It is a 1+1=10 type of thing. Employee retention is also quite high.

I would not be surprised if Siemens is also looking at Ansys. That would be a great fit. And remember Siemens is 20x the size of Synopsys.
 
Technically speaking, is the benefit for thermal analysis of the packaging and thermal gradients across the chip, and perhaps substrate noise? Is it for an EMag solver? Is it for vibration or radiation quantities? Is it to convince the DoD that these effects can be modeled well and justify the cost of this probable expensive software? What would be Synopsys adjustment to their roadmap? Has Mentor's tools been improved by Siemens other technologies? @Tanj , you must have an opinion.
 
The Acquisition of Ansys will close in the first half of 2025 I am told. I would expect layoffs on the Ansys side for sure.
 
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