Cadence Acquires Hexagon's Design & Engineering Business for €2.7 Billion

Cadence has agreed to acquire Hexagon's design and engineering business, including MSC Software, for €2.7 billion. The acquisition is expected to expand Cadence's offerings in the digital engineering and simulation software market. Cadence will pay 70% of the purchase price in cash and the remaining 30% in stock. The transaction is expected to close in the second half of 2023.

Cadence Design Systems, Inc. (Nasdaq: CDNS) has announced a definitive agreement to acquire Hexagon AB's Design & Engineering (D&E) business, including its MSC Software business, for approximately €2.7 billion. The acquisition is expected to significantly expand Cadence's offerings in the digital engineering and simulation software market.

Under the terms of the agreement, Cadence will pay 70% of the consideration in cash and 30% through the issuance of Cadence common stock to Hexagon. The transaction is expected to close in the first quarter of 2026, subject to regulatory approvals and customary closing conditions.

The acquisition will bring Hexagon's renowned mechanical solvers, such as MSC Nastran and Adams, to Cadence, enhancing its multiphysics simulation capabilities. These technologies are integral to the design and validation of complex mechanical systems in the aerospace and automotive sectors, where performance, precision, and reliability are paramount. Additionally, Adams' multibody dynamics capabilities are poised to play a critical role in emerging fields such as robotics and physical AI.

Cadence's president and chief executive officer, Anirudh Devgan, stated, "By adding Hexagon’s D&E world-class simulation capabilities, we will expand our vision of Intelligent System Design to encompass the full spectrum of physical behavior—from electromagnetics and fluids to structures and motion. This will be a pivotal step in enabling our customers to design the complex, converged systems of tomorrow."

The incoming business generated approximately $280 million in revenue in 2024, with over 1,100 employees across multiple global sites. It has world-class R&D, sales, and support teams with deep domain expertise and strong ecosystem partnerships.

The acquisition will allow Cadence to serve a broader customer base, including leading aerospace and automotive OEMs and Tier 1 suppliers such as Volkswagen Group, BMW, Toyota, Lockheed Martin, BAE, and Boeing, who use Hexagon’s D&E solutions for mission-critical simulation workflows.

References
[1] https://www.cadence.com/en_US/home/company/newsroom/press-releases/pr/2025/cadence-to-acquire-hexagons-design--engineering-business.html
[2] https://www.ainvest.com/news/cadence-acquire-hexagon-design-engineering-business-2-7-billion-2509-40/
[3] https://www.marketwatch.com/story/cadence-design-systems-to-buy-hexagon-s-design-and-engineering-business-56fe1fb1
[4] https://www.reuters.com/business/cadence-design-buy-hexagons-design-engineering-unit-316-billion-2025-09-04/
[5] https://www.ainvest.com/news/strategic-rationale-investment-implications-cadence-acquisition-hexagon-business-2509/