IN THE NEWS

Business and technology news from the semiconductor and design tool industries.

In the News

Cadence Design Systems Inc. (San Jose, CA) announced a definitive agreement to merge with High Level Design Systems Inc. (HLDS) of Santa Clara, CA in a move that the companies say will create the industry's first comprehensive approach to designing 0.35-µm chips. The merger immediately aligns the technology and market strengths of HLDS' IC design planning technology and floorplanning capabilities with Cadence's timing-driven design flow. Together the companies plan to define and deliver an integrated RTL-to-silicon deep submicron methodology and sign-off process that enables the successful creation, verification, and integration of complex functional blocks into system-level chips. The merger has been approved by the boards of directors of both companies and is subject to approval by the shareholders of HLDS. The agreement will entail a tax-free, stock-for-stock exchange at a fixed ratio of 0.22 shares of Cadence common stock for each share of HLDS stock. As consideration for the merger, Cadence expects to issue approximately 2.55 million shares and 616,000 employee stock options to purchase shares of Cadence common stock in exchange for all of the outstanding equity securities of HLDS. Based on the Oct. 2, 1996 closing stock price of $36 7/8, the value of Cadence stock to be issued is approximately $94.1 million. The merger will be accounted for as a purchase.

In addition, Cadence announced a definitive agreement to merge with Cooper & Chyan Technology Inc. (CCT) of Cupertino, CA. Through this merger, Cadence plans to create a robust suite of technology for designers of complex integrated circuits (ICs) and high-speed printed circuit boards (PCBs). The merger addresses one of the most critical aspects of next-generation electronic product design: how the elements contained on sophisticated high-speed silicon chips and boards are designed and connected together. By joining their strengths, the merger will accelerate the development of advanced solutions for critical areas such as the creation of building blocks for "system-on-a-chip" design, the assembly of these blocks on high-speed chips, and the design of those complex chips into high-performance PCBs. Under the terms of the merger agreement, each outstanding share of CCT will be exchanged for .85 share of Cadence. The merger is expected to be accounted for as a pooling of interests and is subject to regulatory and CCT shareholder approval. Based on CCT's 12.9 million shares outstanding on September 30, 1996, Cadence will issue approximately 11.0 million shares in the merger.

Precedence Inc. relocated company headquarters to an expanded campus at 1700 Dell Ave., Campbell, CA. In other news, Precedence recently updated its Web site at www.precedence.com.

Alternative System Concepts Inc. (Windham, NH) was chosen as a winner in the first annual "Tibbetts Awards" by the U.S. Small Business Administration Office of Advocacy in Washington, D.C. The Tibbetts Award, named for Roland Tibbetts, the founder of the Small Business Innovation Research (SBIR) program, is granted in recognition of individuals and organizations for outstanding leadership.

Money Bits

Mentor Graphics Corp. (Wilsonville, OR) reported revenue of $100.79 million and net income of $74,000 for Q3 of 1996. Mentor Graphics' recognized merger-related charges of $2.83 million in connection with acquisitions closed during the quarter. Excluding these one-time charges, net income for the quarter was $2.90 million ($0.04 per share). Revenue for Q3 of 1995 was $107.42 million, with net income of $12.38 million ($0.19 per share).

Avant! Corp. (Sunnyvale, CA) reported revenue for Q3 of 1996 was $17,279,000, a 49 percent increase over earnings for Q3 of 1995. Including merger costs associated with the Anagram merger, Avant! reported net income of $3,361,000 ($0.17 per share on 20,152,000 shares). Excluding merger costs, fully taxed net income was $3,959,000, a 25 percent increase over net income for Q3 of 1995.

Technology Modeling Associates Inc. (Sunnyvale, CA) reported total revenue for the three months ended September 30 was $4.8 million, an increase of 68 percent over the same period in 1995. Net income was $298,000 ($0.05 per share) for Q3, an increase of 20 percent over the net income of $248,000 reported for Q3 of 1995. Total revenue for the year rose 52 percent to $12.8 million, compared with $8.5 million for the first nine months of 1995. In other news, TMA begins trading their common stock on NASDAQ under the symbol TMAI.

VLSI Research (San Jose, CA) predicts continued improvement in the semiconductor industry. It also predicts the U.S. book-to-bill ratio will rise slightly in October to 1.02 from 1.01 recorded in September. The semiconductor equipment makers are seeing improvements in the market but will continue to see depressed bookings for the next few months.

EPIC Design Technology Inc. (Sunnyvale, CA) announced total revenue for their Q4 was $12.5 million, an increase of 52 percent, compared to $8.2 million for Q4 of 1995. Net loss for the quarter was $16.2 million ($1.26 per share). The loss was due to a one-time write-off of in-process research and development of $18.8 million in connection with the acquisition of CIDA Technology Inc., incurred in Q4 of 1996.

Lattice Semiconductor Corp. (Hillsboro, OR) announced financial results of $48.6 million for its second fiscal quarter ended September 28, 1996. Net income for the quarter was $10.5 million (or $0.46 per share).

Movers and Shakers

Novellus Systems Inc. (San Jose, CA) appointed Sheila Vaidya as the group vice president of the newly formed Metals Business Group.

Merix Corp. (Forest Grove, OR) announced the appointment of Happy T. Holden as strategic technology director.

QLogic Corp. (Costa Mesa, CA) appointed Mark Edwards vice president of sales and corporate marketing, and Larry Fortmuller has been appointed to the position of vice president and general manager of the Computer Systems Group. Additionally, David Tovey has been appointed to the position of vice president and general manager of the Peripheral Products Group.

Axil Computer Inc. (Santa Clara, CA), a business unit of Hyundai Electronics Industries Co. Ltd., announced that William R. Shellooe has been promoted to president and CEO.

Zuken-Redac Inc. (Santa Clara, CA) named Manfred Asum their new managing director, Central Europe.

Hyundai Electronics America (San Jose, CA) announced that Harry Rozakis is joining its ranks as the new vice president and general manager of HEA's Assembly and Test Division.

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integrated system design  December 1996