UK’s Competition Watchdog Scrutinizes Synopsys’ $35 Billion Acquisition of Ansys

The U.K.’s competition watchdog announced on Monday that it is assessing whether Synopsys‘ planned $35 billion acquisition of Ansys might negatively impact competition in Britain. The Competition and Markets Authority (CMA) has yet to initiate a formal investigation into the significant deal.

In January, Synopsys, a leading chip design software maker, unveiled its intention to purchase Ansys, whose software is widely used in the creation of products ranging from aircraft to tennis rackets, including those favored by top athletes like Novak Djokovic. The $35 billion transaction, a combination of cash and stock, is expected to integrate Synopsys’ expertise in chip design tools with Ansys’s software for evaluating broader electronic systems that incorporate these chips.

Despite the potential synergies, the proposed merger has sparked concerns among industry analysts regarding possible regulatory hurdles, especially in an already consolidated business software sector. The scrutiny by the CMA adds to the growing regulatory attention that the deal has attracted globally.

Related: Synopsys to Acquire Ansys in a Landmark $35 Billion Deal

In May, Synopsys revealed that Chinese regulators had also requested the company’s cooperation in their review of the acquisition. This indicates that the deal is facing thorough examination across multiple jurisdictions. According to Reuters, the CMA’s current review involves gathering information and comments from stakeholders, which will help determine whether the deal should proceed to a phase 1 probe or be cleared of all competition concerns.

The outcome of this investigation could have significant implications for the business software industry, particularly in the chip design and electronic systems sectors, where both Synopsys and Ansys are key players. The CMA’s decision will be closely watched by regulators and industry participants alike.

Source: Reuters