Cadence to acquire Tensilica

Cadence Design Systems, Inc. (NASDAQ: CDNS), a leader in global electronic design innovation, today announced that it has entered into a definitive agreement to acquire Tensilica, Inc., a leader in dataplane processing IP, for approximately $380 million in cash. Tensilica had approximately $30 million of cash as of December 31, 2012.

Further expanding Cadence’s IP portfolio, Tensilica provides configurable dataplane processing units that are optimized for embedded data and signal processing targeted at mobile wireless, network infrastructure, auto infotainment and home applications.

“With Tensilica, we will be able to provide designers with a more complete SoC solution that will speed the development of innovative and differentiated products, while reducing time to market,” said Lip-Bu Tan, president and chief executive officer of Cadence. “We look forward to working with Tensilica’s dedicated employees as one team to bring even more value to our customers.”

Jack Guedj, president and chief executive officer of Tensilica stated, “Joining Cadence will provide a broader platform to expedite our product development strategy and customer engagement. We will have the ability to accelerate IP subsystem development and integration while providing a more extensive support network to our customers.”

Tensilica customized DPUs augment traditional custom hardware design, offering both time-to-market and programmability advantages and can be optimized to achieve optimal power, performance and area efficiency. Tensilica IP provides application-optimized subsystems that work synergistically with industry-standard CPU architectures.

“The acquisition of Tensilica by Cadence will be a positive move for the industry,” said Simon Segars, president of ARM Holdings plc. “We look forward to expanding our ongoing collaboration with Cadence to enable our customers to bring great products to market.”

Cadence intends to finance the transaction with available cash and an existing revolving credit facility. The transaction is expected to close in the second quarter of fiscal 2013, subject to customary closing conditions including regulatory approvals. Cadence expects the transaction to be slightly dilutive to its non-GAAP earnings per share in fiscal 2013 due to the impact of merger-related accounting and accretive to its non-GAAP earnings per share in fiscal 2014. The impact on GAAP earnings per share will be available after valuation and the completion of purchase accounting.

Audio Webcast Scheduled
Lip-Bu Tan, Cadence’s president and chief executive officer, and Geoffrey Ribar, Cadence’s senior vice president and chief financial officer, will host an audio webcast to discuss the proposed acquisition on March 11, 2013 at 2:00 PM (Pacific) / 5:00 PM (Eastern). Attendees are asked to register at the web site at least 10 minutes prior to the scheduled webcast. An archive of the webcast will be available starting March 11, 2013 at 5:00 PM (Pacific) and ending March 25, 2013 at 5:00 PM (Pacific). Webcast access is available at www.cadence.com/cadence/investor_relations