Wednesday, December 01, 2004

Synopsys tries another buy!

Synopsys today announced the acquisition of Nassda for a 60% premium! This came as a surprise to me given Synopsys' earlier aborted attempt to buy Monolithic Systems

I still see Monolithic Systems (MOSY) as a target and will be buying at the current price.

In addition, Magma Designs (LAVA) looks cheap now, after the recent earnings miss. Synopsys or the other players will surely end up buying it. I am buying at the current price.

Ultimately, Synopsys and Cadence will remain as independent players - the rest will be assimilated. That means at some point when it becomes cheap enough, Mentor Graphics (MENT) will also make for a good takeover target.

Synplicity (SYNP), Ansoft (ANST), PDF Solutions (PDFS) and Verisity (VRST) are the other smaller entities. I don't know enough about them yet, though I do remember reading an interview with PDF Solutions' CEO, where he did not rule out a sale of the company.

For conservative investors looking for a 100-150% return over the next 2-3 years, Synopsys itself is a great non-speculative bet. Just buy now and don't look at it for a long time!


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