Synopsys to Buy Analog Design Automation
By Ed Sperling -- 1/28/2004
Acquisitions are under way again in the EDA market in what could be the latest signal of a sustained recovery and a shift into a focus on analog.
Synopsys Inc. today made public its intention to acquire Analog Design Automation, an Ottawa, Canada-based start-up in which Synopsys was an early investor. ADA makes tools to optimize circuits in analog designs, which the two companies plan to fuse together with the HSPICE product line that Synopsys acquired with Avant! last year.
Synopsys was an A-round investor in ADA, along with Intel, Royal Bank Capital and Business Development Corp., among others. The exit strategy through acquisition has become a favorite of companies in the EDA space, which are not pulling down the kinds of returns through IPOs that they did before the downturn.
“EDA exits both ways are pretty good,” said Matthew Raggett, CEO of ADA. “But the channel that Synopsys has developed is something to take advantage of. We saw a tight integration with HSPICE would be beneficial.”
“When you’re talking about keeping track of 10 to the power of 80, it makes sense to automate it,” said Raggett. “This has been an area in which few people have worked so far because of the complexity.”
With interest in analog growing, particularly in the explosive consumer electronics market, Synopsys clearly sees the need to carve out a position in this space. One step down the food chain in the controller and analog chip market, players like Texas Instruments, Analog Devices, National Semiconductor and Linear Technology have been slugging it out for a piece of the growing pie. That means providing tools for analog designers is becoming increasingly lucrative for all the major EDA players.
Bijan Kiani, VP of marketing for Synopsys’ analog and mixed signal group, said his company opted for an acquisition rather than an ongoing working partnership because the two companies saw advantages in integrating their product lines. Synopsys currently makes HSPICE and NanoSim circuit simulators. Adding analog optimization fills a hole in Synopsys’ line card.
Kiani noted that there were no other bidders for the company, in which Synopsys was a minority shareholder.
Neither company would comment on terms of the deal.
ADA was started in 1999, largely focused on U.S.-based designers. The company is now beginning to make a push into Europe and Japan, said Raggett.
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