Cadence to Acquire BETA CAE, Expanding into Structural Analysis

Cadence Design Systems, Inc. (Nasdaq: CDNS) today announced it has entered into a definitive agreement to acquire BETA CAE Systems International AG, a leading system analysis platform provider of multi-domain, engineering simulation solutions. The addition of BETA CAE’s proven technologies and talent will accelerate Cadence’s Intelligent System Design strategy by expanding its multiphysics system analysis portfolio and enabling entry into the structural analysis segment, unlocking a multi-billion-dollar incremental TAM opportunity. Under the terms of the definitive agreement, Cadence will pay approximately $1.24 billion for the transaction, with 60 percent of the consideration to be paid in cash and 40 percent to be paid through the issuance of Cadence common stock to current BETA CAE shareholders. In conjunction with the transaction, Cadence expects to obtain new debt financing to fund a portion of the cash component of the purchase price. Cadence plans to use free cash flow generated by its existing operations to rapidly pay down debt incurred to fund the transaction, while also maintaining share repurchases.

Increasing system complexity and time-to-market pressures from accelerating mechanical and electrical hyperconvergence, along with the digital transformation in multiple industries, are driving the need for multiphysics simulations early in the design cycle. Over the past few years, Cadence has expanded its system analysis portfolio to build out a comprehensive multiphysics platform including electromagnetics (EM), electrothermal (ET) and computational fluid dynamics (CFD) solutions, and with BETA CAE, Cadence will enter structural analysis, the largest system analysis segment.

BETA CAE is a highly respected industry leader, well-known for its groundbreaking, innovative, high-performance simulation software and best-in-class services. BETA CAE’s portfolio includes its flagship pre- and post-processing products, which are the industry gold standard, mechanical and structural simulation and multiphysics analysis, and simulation, process, data, and resources management (SPDRM) solutions, among others. BETA CAE has a very strong footprint in the automotive vertical sector, delivering solutions to the top 10 global automobile manufacturers and most Formula One racing teams, as well as leading customers in the aerospace, industrial and healthcare industries. BETA CAE customers include marquee names such as Honda Motor Company Ltd., General Motors Company, Stellantis, Renault Group, Volvo Cars and Lockheed Martin Corporation, among others.