Cadence acquires Altos Design Automation

SAN JOSE, CA--(Marketwire - May 10, 2011) - Cadence Design Systems, Inc. (NASDAQ: CDNS), a leader in global electronic design innovation, today announced it has acquired Altos Design Automation, Inc., the technology leader in enabling foundation IP development for the delivery of complex SoCs at advanced nodes. Shrinking process geometries increase process variations and make creation of accurate noise, power and timing models for foundation IP very complex given smaller time-to-market windows. Altos tools enable ultra-fast and accurate characterization of memory, standard cell libraries and other foundation IP, generating required models for SoC implementation. When combined with the Cadence end-to-end Silicon Realization portfolio, the offering gives customers greater visibility into the effects of noise, timing and power at every phase of the design cycle, including foundation IP design creation, extraction, SPICE simulation, and implementation. The acquisition is another important step in delivering on the company's EDA360 vision.

"Foundation IP characterization is becoming mission critical at advanced nodes due to shrinking time-to-market windows, escalating low-power, high-speed design complexities, and variations in advanced processes," said Dr. Chi-Ping Hsu, Senior Vice President, Research and Development, Silicon Realization Group at Cadence. "By extending our Silicon Realization tool offering to include technically superior solutions that automate vital phases of the design process, we deliver the end-to-end approach that is required to ensure our customers' success."

"Altos has established itself as the technology leader in foundation IP enablement, with a proven solution in use today by many of the world's leading semiconductor and foundation IP providers," said Jim McCanny, CEO and founder, Altos. "I'm looking forward to working with Cadence to further exploit the capabilities of our characterization technology, and help deliver a more powerful combined solution that overcomes our customers' most difficult design challenges."

Altos has over 30 customers, including 11 of the top 20 semiconductor companies. Terms of the acquisition were not disclosed.

About Cadence
Cadence enables global electronic design innovation and plays an essential role in the creation of today's integrated circuits and electronics. Customers use Cadence software, hardware, IP and services to design and verify advanced semiconductors, consumer electronics, networking and telecommunications equipment, and computer systems. The company is headquartered in San Jose, Calif., with sales offices, design centers, and research facilities around the world to serve the global electronics industry. More information about the company, its products, and services is available at www.cadence.com.

Cadence and the Cadence logo are registered trademarks of Cadence Design Systems, Inc. in the United States and other countries. All other trademarks are the property of their respective owners.

Cadence Design Systems 10K

Revenue breakout and trends:

• "Product revenue was $516.6 million, or 50% of our total revenue, during fiscal 2008; $1,104.0 million, or 68% of our total revenue, during fiscal 2007; and $982.7 million, or 66% of our total revenue, during fiscal 2006.
  
• Maintenance revenue was $388.5 million, or 37% of our total revenue, during fiscal 2008; $385.2 million, or 24% of our total revenue, during fiscal 2007; and $366.3 million, or 25% of our total revenue, during fiscal 2006.
• Services revenue was $133.5 million, or 13% of our total revenue, during fiscal 2008; $125.8 million, or 8% of our total revenue, during fiscal 2007; and $134.9 million, or 9% of our total revenue, during fiscal 2006."

Loss on Mentor Graphics stock: "During fiscal 2008, we purchased approximately 4.3 million shares of Mentor Graphics common stock in connection with our proposed acquisition of Mentor Graphics. After the announcement of our withdrawal of the proposed acquisition of Mentor Graphics, we sold our entire equity interest in Mentor Graphics at a loss of $9.4 million."

Change in DFM strategy: "Our primary focus in DFM is to address manufacturing effects as early in the product development process as possible. As a result, we are enhancing the DFM awareness of our core Encounter Digital IC and Virtuoso Custom IC product offerings. Where upstream integration is not possible, Cadence offers certain stand alone DFM products. In connection with our cost savings initiatives that were implemented during the fourth quarter of fiscal 2008, we adjusted our roadmaps and investment consistent with our current DFM strategy. The changes in our DFM strategy resulted in an impairment charge of $42.5 million arising from the abandonment and reduction to net realizable value of certain identifiable intangible assets."

Employees: "As of January 3, 2009, we employed approximately 4,900 individuals, with approximately 1,800 in sales, services, marketing, support and manufacturing activities, approximately 2,400 in product research and development and approximately 700 in management, administration and finance. During fiscal 2008, we initiated a restructuring plan to decrease costs by reducing our workforce across the company. This restructuring plan is expected to reduce our workforce by at least 625 positions. Approximately 300 of the affected employees were still employed by us as of January 3, 2009 due to regulatory requirements in certain jurisdictions in which we operate. "