Synopsys Completes $35B Ansys Acquisition, Boosts Revenue Expectations and Market Leadership

Synopsys has completed a $35 billion acquisition of Ansys, gaining market leadership in the chip-to-system design software industry. The merger positions the company to exceed $10 billion in revenue by 2026, prompting a price target increase to $660 with a "Buy" rating from Needham. Regulatory compliance led to divestitures to Keysight Technologies. Analysts predict an average target price of $596.36, with a potential upside of 7.74% from the current price of $553.50.

Synopsys has completed its $35 billion acquisition of Ansys, marking a significant milestone in the semiconductor industry. This strategic move positions Synopsys to become a leading player in the chip-to-system design software market, with analysts predicting an increase in revenue to exceed $10 billion by 2026. The acquisition also led to a price target increase to $660 with a "Buy" rating from Needham [2].

The merger was initially announced in January 2024 and received regulatory approvals from the United States and the European Union. However, the process was delayed due to export regulations on electronic design technology exports from the U.S., which affected Synopsys' operations in China. Despite these challenges, Synopsys successfully closed the deal, with the combined company now poised to deliver more holistic and integrated design solutions [1].

Synopsys President and CEO Sassine Ghazi highlighted the transformational potential of the acquisition, stating, "The increasing complexity of developing intelligent systems demands design solutions with a deeper integration of electronics and physics, enhanced by AI. With Ansys’ leading system simulation and analysis solutions now part of Synopsys, we can maximize the capabilities of engineering teams broadly, igniting their innovation from silicon to systems" [1].

The acquisition brings Ansys' multi-physics expertise and automotive-specific virtual testing capabilities to Synopsys, aiming to integrate design within the broader context of system functionality. This strategic move also opens up new growth opportunities in the aerospace, automotive, and industrial equipment sectors, potentially expanding Synopsys' addressable market and business portfolio [1].

However, regulatory compliance necessitated the divestiture of certain assets to Keysight Technologies. These assets include Synopsys' optical software tools and Ansys' Register Transfer Level (RTL) power consumption analysis tools. The divestitures were part of the conditions imposed by the Federal Trade Commission to address anticompetitive concerns about the merger [1].

Analysts predict an average target price of $596.36, with a potential upside of 7.74% from the current price of $553.50. This optimism is driven by the combined company's potential to offer more integrated and holistic design solutions, positioning Synopsys as a leader in the chip-to-system design software market [2].

References:
[1] https://www.rcrwireless.com/20250717/test-and-measurement/ansys-acquisition
[2] https://www.marketscreener.com/news/synopsys-inc-completed-the-acquisition-of-ansys-inc-from-blackrock-inc-the-vanguard-group-in-ce7c5cd9d18ff322