Synopsys buys Monterey Design, source confirms

Late last week, other sources said Monterey had sold off its assets for $5 million. Their accounts differed, however, as to whether Synopsys or Synplicity was the buyer.

On Saturday (Oct. 9), a source close the acquisition confirmed that Synopsys has acquired Monterey for a purchase price higher than $5 million.

Synopsys likely paid less than $50 million for Monterey since Synopsys officials would have been legally obligated to formally announce the acquisition if the purchase price exceeded 5 percent of its own revenues.

Synopsys and Monterey officials weren't available to comment on the acquisition, but earlier in the week a Synopsys spokeswoman said it does not comment on mergers and acquisitions. She also refused to confirm or deny if the acquisition had taken place.

Also, Monterey President and CEO Jacques Benkoski declined to comment when asked about the acquisition.

The acquisition gives Synopsys Monterey's Dolphin RTL to GDSII technology, Calypso virtual prototyping technology and likely adds to the company's patent portfolio in the RTL to GDSII tool market.

Sources earlier said Synopsys plans to use Calypso to fill a gap in its own RTL to GDSII portfolio, but will likely shelve Monterey's Dolphin technology.

It remains unclear if Synopsys intends to use any of Monterey's patents in its suit against Magma Design Automation.

Monterey raised about $115 million in venture funding since its founding in 1997. Sources said its various venture backers have written off over $85 million in losses since the company's inception. Monterey's lead backer is Sevin Rosen, but the company has also received funding from Information Technology Ventures, Rho Ventures, Nokia Ventures and U.S. Trust.

Monterey was often touted along with Magma Design Automation as offering the next generation of physical design tools.

Unlike Magma's tool line, however, Monterey's Dolphin synthesis-to-placement tools were not widely adopted due in part to Monterey's use, early in its history, of a Web-based ASP model. Most of the EDA industry has used perpetual and term licensing.

After reverting to a more traditional model, the company continued to struggle. Two years ago, it tried to reinvent itself by making its Calypso virtual prototyping product its flagship technology. Calypso was created by melding Monterey's Sonar floorplanner tool with the IC Wizard RTL design planner gained when Monterey merged with Aristo Technology Inc. in 2001.

Earlier this year, Benkoski told EE Times Monterey had finally swung to profitability, based on the success of its Calypso product. The company had also moved much of its research operation to its R&D center in Armenia.