EU approves $35 billion Synopsys and Ansys merger subject to waiver terms

European Commission (EC) gave green light for Synopsis to get Ansysalthough companies must sell various software products as part of the protections offered.

Chip design software maker Synopsys announced its plans last January acquiring Ansys, a developer of simulation software that helps engineers model and analyze the physical behavior of products like chips and evaluate their real-world performance.

The $35 billion transaction involving the two publicly traded companies is the largest in the technology sector since Broadcom bought VMware for $69 billion. This combination also attracted the attention of regulators it was finally adopted by the EC in July 2023 after the parties have agreed to commitments on continued access and interoperability.

As far as regulators are concerned, the crux of the matter is that such a merger could create a comprehensive chip design and simulation giant that could overwhelm competitors that don’t offer such a merger. Thus, the EC now states that firms will sell overlapping parts of their businesses to an EC-approved “eligible buyer”.

Synopsys already had agreed to sell to its Optical Solutions Group Keysight, but now it will also sell its optics and photonics applications Code V, LightTools, LucidShape, RSoftand ImSym. Ansys will also give up PowerArtista program that can analyze and optimize the energy consumption of electronic circuits at a very detailed level.

“We were concerned that this acquisition could significantly harm competition in certain global markets for design software for chips or other products,” said Teresa Ribera, the European Commission’s executive vice-president for a clean, fair and competitive transition. “However, thanks to the clear structural tools offered by the parties, competition will be preserved in these markets and customers will continue to have access to innovative tools at competitive prices.”

Confirmations

UK Competition and Markets Authority (CMA) launched its own antitrust investigation Back in operation in August, and CMA earlier this week stated that is also willing to accept the proposed waiver offer.

But today’s announcement doesn’t mean the deal is done and dusted. So has the Federal Trade Commission (FTC). looks at the proposed mergerboth Synopsys and Ansys are significant Relations with Chinaalso — and the country’s State Administration for Market Regulation (SAMR) reported looking for a solution.

A Synopsys spokesperson confirmed that it is still “cooperating with the FTC” as it reviews remedies, while continuing to work with other markets around the world, including China.

“We are delighted that the EC has approved our competitive bid in Phase 1,” the spokesperson said. “Today’s clearance decision follows strong progress we have made towards obtaining regulatory approvals in various jurisdictions. China has officially accepted our SAMR application and is in the process of reviewing it. In addition, we continue to work with regulators in other relevant jurisdictions to finalize their opinions.”

The spokesperson added that it expects the transaction to close in the first half of 2025.