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 What Would Joe Do?
Peggy Aycinena
Peggy Aycinena
Peggy Aycinena is a freelance journalist and Editor of EDA Confidential at www.aycinena.com. She can be reached at peggy at aycinena dot com.

Wow factor: SNPS to acquire SpringSoft

 
August 2nd, 2012 by Peggy Aycinena

When it comes to wow factor, nothing outpaces the August 3rd announcement that Synopsys is going to acquire Taiwan-based SpringSoft. The announcement is astonishing for three reason:

1) Synopsys just announced the acquisition of Ciranova last week. True, the details of that deal were not released and Ciranova is not a ‘large’ company – still, two acquisitions by Synopsys in as many weeks is noteworthy.

2) SpringSoft is a publicly-traded company and therefore the details of the acquisition must be announced: Synopsys will be paying about $300 million for SpringSoft (net of cash acquired), which is a helluva lot of money …

3) … given that Synopsys has already executed another high-profile, high-priced acquisition of a publicly traded company earlier this year, buying Magma Design Automation for about $523 million (net of cash acquired).

Wow!

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Per the August 3rd Press Release: “The combination of SpringSoft’s and Synopsys’ industry-leading verification technology portfolios will help accelerate delivery of a unified, powerful SoC debug environment … by integrating the physical design technology and teams from SpringSoft, Ciranova and Magma, Synopsys can accelerate innovation and offer a higher level of automation in custom implementation tools.”

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So what’s going on?

1) Synopsys is on a tear, proving to their industry and everyone else that the company is unequivocally the 800-pound gorilla in EDA.

2) With the acquisition of debug-centric SpringSoft, Synopsys now has a finger in all of the pieces of the EDA pie. (Short of manufacturing data mining? PDF Solutions next?)

3) SpringSoft is Taiwan-based, so Synopsys now gains a larger foothold on the ground there. Chi-Foon Chan, Synopsys President & Co-CEO, is quoted in the Press Release: “This acquisition will increase Synopsys’ investment in Taiwan by growing our local engineering expertise, technology development capabilities and customer support.”

Synopsys acquiring SpringSoft is undeniably an expression of GlobalSpeak.


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SpringSoft & the Future of GlobalSpeak …

[blog posted June 19, 2008]


On May 27, 2008
, Taiwan’s SpringSoft announced a merger with San Jose’s Novas Software and the acquisition of Silicon Canvas, Nanovata, Fortelink, and Novaflow.

To some, “merger” and “acquisition” are relative terms in this context, because SpringSoft was itself the entity that founded Novas, Novaflow, and Silicon Canvas in 1997, 2000, and 2001, respectively.

Be that as it may, the newly created SpringSoft, circa 2008, now describes itself as “the largest EDA company in Asia and the first to be publicly traded [there].” And why is this momentous news? Best to answer that question with a question.

True or False? The epicenter of the EDA industry is in Silicon Valley.  Given the news of May 27th, the answer to that question is distinctly, False. In my opinion, the epicenter of the EDA industry is moving steadily to Asia. SpringSoft stands ready and able to prove that’s the case. Let’s look at the evidence:

1) SpringSoft is claiming two corporate headquarters, one in Hsinchu and one in San Jose, yet the org chart for the company clearly indicates the CEO, COO, and CFO are all based out of Taiwan. To the untrained eye, it looks like the headquarters are in Taiwan and only a regionally-based administrative team reside in Silicon Valley.

2) There’s little ramp-up required for the newly aggregated SpringSoft: Novas is a known player with established debug technology, and Silicon Canvas is also well known with established layout technology. The channels for both product lines are in place, the teams are familiar with each other and their respective portfolios, and SpringSoft therefore hits the ground running in Asia, in North America, Europe and Japan. Meanwhile, Novaflow becomes SpringSoft KK and capitalizes on efficient direct sales in Japan.

3) Most EDA R&D is no longer centered in North America. Cadence, alone, has over 800 developers in India. Similarly, SpringSoft has R&D in Taiwan, China, and the U.S.

4) Of even greater importance, designers are coming online in ferociously huge numbers in geographies outside of North America, particularly in Asia and India. And they’re not just working on low-level designs at older process technologies, but cutting edge-designs at the foundation of the quick-to-morph consumer electronics industry. Of course, consumers of those electronic products are coming online in Asia and India in ferocious numbers, as well. An EDA company based in Asia is closer to the action.

5) Per SpringSoft’s published information, the company now has 400+ employees in Asia, North America, the Middle East, and Europe, a market cap of $200+ million, and 400+ customers. Contrast those stats with info for the Big Four in EDA (per Yahoo Financials, as of June 18, 2008), and you’ll see that SpringSoft is hot on their heels.

* Synopsys - 5300 employees. Market cap, $3.54 billion. Revenues in the range of $1.3 billion.

* Cadence Design Systems - 5300 employees. Market cap, $ 2.8 billion. Revenues in the range of $1.54 billion.

* Mentor Graphics - 4300 employees. Market cap, $1.38 billion. Revenues in the range of $870 million.

* Magma Design Automaton - 850 employees. Market cap, $304 million. Revenues in the range of $215 million.

So, there you’ve got it. SpringSoft is already large enough to claim the No. 5 spot in the EDA pantheon, and very possibly the No. 4 or even the No. 3 spot depending on how things develop over the next 18 months, or so.

SpringSoft is not the result of the merger and/or acquisition of disparate entities, but the re-aggregation of existing pieces launched separately. The pieces now walk in lock step, share a single global channel, and pursue an integrated corporate vision.

Finally, SpringSoft is an Asia-based company, close to the customers and close to the customers’ customers.

I don’t care how often people invoke GlobalSpeak to prove it’s an international economy, a flat world, or a place where borders no longer matter – being an Asia-based company in this industry will be the single, most important differentiating factor for any successful EDA company in the emerging era.

Look at SpringSoft. See the future of the industry.

 
[published in EDA Confidential, June 19, 2008]

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One Response to “Wow factor: SNPS to acquire SpringSoft”

  1. Sean Murphy says:

    I think we are watching Synopsys run the table in EDA.

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