Synopsys faces UK competition probe over $35 billion Ansys merger

The UK’s Competition and Markets Authority (CMA) has voiced concerns over Synopsys’ proposed $35 billion acquisition of Ansys, claiming the deal could harm innovation, reduce product quality, and increase costs in the semiconductor design and light-simulation software markets. The regulator fears diminished competition could negatively impact UK businesses and consumers, particularly in sectors such as artificial intelligence and cloud computing, which rely heavily on semiconductor technology.

Synopsys, a leader in chip design software, announced the acquisition in January, aiming to combine its tools with Ansys’ diverse software offerings, used in industries ranging from aerospace to consumer goods. However, the CMA has highlighted risks of reduced consumer choice and a potential stifling of advancements in the sector. If these concerns are not adequately addressed, the regulator may initiate an in-depth investigation into the merger.

In response, Synopsys has proposed selling its optical solutions business to Keysight Technologies, a move it believes will satisfy the CMA’s concerns. A company spokesperson expressed confidence in resolving the regulatory hurdles and expects the deal to close in the first half of 2025. The CMA’s final decision could shape the future landscape of competition in the semiconductor and simulation software industries, as global demand for advanced technologies continues to grow.