The State Administration for Market Regulation gives the green light to the US$35 billion deal under certain conditions.
China’s antitrust regulator on Monday approved American chip design software giant Synopsys’ US$35 billion acquisition of Ansys, weeks after the administration of US President Donald Trump lifted export controls on electronic design automation (EDA) products to the mainland.
In a statement, the State Administration for Market Regulation (SAMR) said it gave the green light to Synopsys’ deal for Ansys, a computer-aided engineering software vendor, under the condition that the two firms honour their contractual obligations to Chinese clients.
Synopsys and Ansys were also required to not terminate existing agreements or reject any Chinese customer’s request to renew their contracts.
The conditions set by SAMR reflect the importance of EDA technology to China’s semiconductor industry, while sending a sign of easing bilateral tensions after Washington lifted export curbs on the software.
Synopsys, Cadence and Siemens held a combined 82 per cent revenue share in China’s EDA market last year, according to a Morgan Stanley research note in May.
Earlier this month, the three EDA suppliers confirmed that the US Commerce Department had rescinded the export controls, which were implemented in May when the agency’s Bureau of Industry and Security (BIS) notified each of them to halt sales on the mainland.
The US export ban on EDA software, which is essential for designing advanced artificial intelligence chips, affected all customers in China, including employees of global customers working at sites in the country and Chinese military users wherever they were located, according to the BIS notice.
Chinese semiconductor design software vendors Empyrean Technology, Primarius Technologies and Semitronix were briefly in the spotlight last month, following news of the ban. The Shenzhen-listed shares of these firms initially recorded strong trading, as investors hoped they could become major alternative EDA suppliers in China.
The US policy change came on the heels of a trade agreement reached between Beijing and Washington late last month.
After announcing the Ansys acquisition in January 2024, Synopsys expected the transaction to close in the first half of this year.
Beijing, however, reportedly blocked the transaction when Washington imposed a restriction on China’s access to EDA software from Synopsys, Cadence and Siemens, according to a June report by The Financial Times.
The Synopsys-Ansys deal had already obtained approvals from other major jurisdictions in the world, including the US and the European Union, subject to certain conditions.
The US Federal Trade Commission said in May that Synopsys needed to divest its optical software and photonic software tools, while Ansys had to sell a power consumption analysis tool. The European Commission also ordered similar divestitures.
Shares of Empyrean and Semitronix both edged down 0.54 per cent and 0.47 per cent, respectively, on Monday. Primarius’ stock rose slightly to 0.35 per cent.
Source: SCMP
