Synopsys Agrees to Acquire Avant

Synopsys Inc. said it will acquire Avant Corp. for about $769 million in stock, rounding out its product line-up for software used to design computer chips and making it a more formidable competitor to rival Cadence Design Systems Inc.

Avant, whose software is popular in helping to create the so-called back-end of semiconductor designs, has seen its stock price decline 40% this year, driven by a slump in the chip industry and concern it would be unable to survive competing against larger rival Cadence. In July, Avant was ordered to pay at least $182 million to Cadence as compensation for stealing trade secrets.

Under their agreement Mountain View, Calif.-based Synopsys said it will exchange 0.371 Synopsys shares for each share of Avant stock. The proposed acquisition values each Avant share at $20.55.

Synopsys is the second-biggest maker of EDA, or electronic design automation software, after Cadence, and its software is used to develop, simulate and test the physical design of integrated circuits.

Separately, Synopsys reported a better-than-expected 17% rise in fiscal fourth-quarter net income on a 38% jump in revenue but warned that results in the current quarter will miss expectations and lowered its forecast for the full year 2002.

Shares of Synopsys fell $10 to $45.28 in after-hours trading, while Avant shares surged $5.82, to $16.77. Before the news was released, Synopsys shares closed up 36 cents at $55.39 and Avant closed up 64 cents at $10.95, both on Nasdaq.