(Reuters) – Britain's competition watchdog said on Monday it was investigating whether chip design software maker Synopsys' $35 billion acquisition of Ansys would hurt competition in Britain.
The Competition and Markets Authority (CMA) has yet to launch a formal investigation into the deal.
CONTEXT
In January, chip design software maker Synopsys revealed plans to acquire Ansys, whose software is used to create a wide range of products from airplanes to tennis rackets used by players like Novak Djokovic, in a $35 billion cash-and-stock deal.
WHY IS IT IMPORTANT?
Synopsys specializes in creating chip design tools that complement Ansys software for evaluating broader electronic systems incorporating these chips.
However, the proposed merger has raised concerns among analysts about potential regulatory challenges in the already established enterprise software sector.
In May, Synopsis, which works with major chipmakers including Taiwan Semiconductor Manufacturing Co and Intel (NASDAQ:), said Chinese regulators had requested its cooperation in examining the deal.
WHAT'S NEXT?
Based on the feedback received during the information-gathering process, the watchdog will either refer the deal to a Phase 1 investigation or clear it of all competition concerns.
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