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Peggy Aycinena
Peggy Aycinena
Peggy Aycinena is a freelance journalist and Editor of EDA Confidential at She can be reached at peggy at aycinena dot com.

M&A: CDNS + Tensilica = win/win

March 12th, 2013 by Peggy Aycinena

As the trading day in New York draws to a close, it would appear that some analysts are correct; the market’s not too pleased about yesterday’s announcement that Cadence is acquiring Tensilica. Shares of CDNS are trading down well over 3% today. But you know, the market’s stupid. They understand zip zero nada about EDA or IP, and really why should they?

After all, EDA and IP providers make the black magic that they do look so easy. And, they’re constantly telling people that what they do isn’t rocket science. But it is! The EDA vendors make the tools that IP vendors use to create their products, and designers use to integrate said IP into the larger designs. It’s called an eco-system and it is rocket science.

It’s also on the level of brain surgery, quantum physics, and a bunch of other esoteric science and engineering disciplines that require a lot of education and and a lot of OJT, and even then is really hard to do. How many traders on Wall Street, or the analysts who track it all, really understand what EDA and/or IP are all about? Exactly!

Designing chips is hard and it’s complex. But happily in this day and age, that process has been made [somewhat] easier by the presence of IP providers, the guys who make the little blocks that get combined to make the bigger blocks, that get combined to make the whole honking system, whatever that system is and at whatever level of abstraction it lives.

So back to the CDNS/Tensilica deal. Let’s be honest; it was a damn smart move on the part of the Cadence. No ifs, ands, or buts about it. Really, truly, a damn smart move. Tensilica’s a great company. If it weren’t, Cadence wouldn’t be buying it for $380 million [less the $30 million they’re getting in the deal that Tensilica’s got in the bank].

And the deal is doubly smart because, given the recent spate of acquistions that Synopsys has laid down (Magma, SpringSoft, EVE, et al), Cadence has snapped up one of the really great ones and, in the process, kept it out of Synopsys’ hands.

And by the way, have you read the actual Press Release out of Cadence that announced the deal? No less than Simon Segars, President of ARM, is quoted there as endorsing the move: “The acquisition of Tensilica by Cadence will be a positive move for the industry. We look forward to expanding our ongoing collaboration with Cadence to enable our customers to bring great products to market.”

Exactly. Damn smart move. No if, ands, or buts about it.

Chris Rowen …

Want to know more about Tensilica? You can read a September 2012 WWJD interview with Founder & CTO Chris Rowen here on EDACafe.

EDAC Panel on March 14th …

You can ask Simon Segars about the CDNS/Tensilica deal yourself at the upcoming EDAC CEO Forecast Panel this week. Or you can direct your questions to Cadence CEO Lip-Bu Tan. He’ll also be on stage at the DoubleTree Inn on Thursday evening.


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