Synopsys to acquire Magma Design Automation

MOUNTAIN VIEW, USA: Synopsys Inc. has signed a definitive agreement to acquire Magma Design Automation Inc., a provider of chip design software headquartered in San Jose, California.

Bringing together complementary technology, development and support capabilities will enable the combined company to more rapidly meet customer requirements linked to chip designs at both leading-edge and mature process nodes.

Under the terms of the merger agreement, Synopsys will acquire Magma for $7.35 per Magma share in cash, resulting in a transaction value of approximately $507 million net of cash and debt acquired. The boards of directors of both companies have unanimously approved the transaction.

The closing of the merger is subject to customary conditions, including approval by the stockholders of Magma as well as U.S. regulators. In the event the merger closes as expected in the second calendar quarter of 2012, Synopsys anticipates it to be modestly accretive to non-GAAP earnings per share in its fiscal 2012. Synopsys plans to fund the acquisition with a combination of cash and debt, with the specifics to be determined at the time of close.

"The dramatic rise in complexity of today's semiconductor designs for all process nodes requires an equally dramatic increase in designer productivity. Customers are either dealing with the very complex physics of 20-nanometer design or they are squeezing the last bit of performance and cost from designs at mature, high-value nodes. To achieve success, our customers are asking for more new EDA capabilities than ever before," said Aart de Geus, chairman and CEO at Synopsys.

"This acquisition will enable Synopsys to accelerate the delivery of the technology our customers need to keep the overall cost of design in check."