This story was originally published on Manufacturing Dive. To receive daily news and insights, subscribe to our free daily Manufacturing Dive newsletter. Dive Brief:  Chip design software maker Cadence Design Systems has agreed to acquire the design and engineering business of Hexagon, a Stockholm-based industrial technology firm, for roughly $3.18 billion in cash and stock. The deal, if approved by regulators, would expand Cadence’s portfolio to include multiphysics simulation software used widely acros ...

Key Takeaways Cadence will buy Hexagon's Design & Engineering division, including MSC Software, for 2.7B euros.The deal expands Cadence's System Design & Analysis reach into advanced structural analysis.Hexagon's D&E serves top aerospace and auto clients with tools like MSC Nastran and Adams.Cadence Design Systems, Inc. (CDNS) has signed a definitive agreement to acquire the Design & Engineering (D&E) division of Hexagon AB, including its renowned MSC Software business, an industry pioneer in engineering si ...

Core Viewpoint - Cadence has announced the acquisition of Hexagon AB's Design & Engineering (D&E) business, including its MSC software, to enhance its "Intelligent System Design™" strategy and expand its system design and analysis product portfolio [2][4]. Group 1: Acquisition Details - The acquisition involves a payment of approximately €2.7 billion, with 70% in cash and 30% in Cadence common stock [2]. - The deal is expected to close in the first quarter of 2026, pending regulatory approvals and customary closing conditions [5]. Group 2: Strategic Implications - The integration of Hexagon's D&E technology will strengthen Cadence's position in the multi-billion dollar structural analysis market, following its 2024 acquisition of Beta CAE [2][5]. - The acquisition will enable Cadence to provide a comprehensive, unified, end-to-end multiphysics platform, addressing the growing demand for early-stage multiphysics simulations in design cycles [3][4]. Group 3: Market Impact - The combined business is projected to generate approximately $280 million in revenue in 2024 and will employ over 1,100 staff globally [5]. - The acquisition will broaden Cadence's customer base, including major aerospace and automotive OEMs such as Volkswagen, BMW, Toyota, Lockheed Martin, BAE, and Boeing, who rely on Hexagon's D&E solutions for critical simulation workflows [4][5].

Core Viewpoint - Cadence has announced the acquisition of Hexagon's Design and Engineering (D&E) business, which will enhance its capabilities in simulation and analysis solutions, particularly in the aerospace and automotive sectors [3][4]. Group 1: Acquisition Details - The acquisition involves a payment of approximately €2.7 billion, with 70% in cash and 30% through the issuance of Cadence common stock [3]. - The deal is expected to be completed in the first quarter of 2026, pending regulatory approvals and customary closing conditions [4]. - If the transaction does not close, Cadence may incur a reverse termination fee of up to €175 million [3]. Group 2: Strategic Implications - This acquisition is part of Cadence's strategy to expand its "Intelligent System Design™" and significantly enhance its system design and analysis product portfolio [3]. - The integration of Hexagon's D&E technology is anticipated to strengthen Cadence's position in the multi-billion euro structural analysis market [3]. - The combined business is projected to generate approximately $280 million in revenue in 2024, leveraging a workforce of over 1,100 employees globally [3]. Group 3: Market Position and Client Base - Cadence's client base will broaden to include major aerospace and automotive OEMs such as Volkswagen, BMW, and Lockheed Martin, who utilize Hexagon's D&E solutions for critical simulation workflows [3]. - Hexagon's D&E business is recognized for its flagship products MSC Nastran and Adams, which are industry standards in structural and multibody dynamics simulation [3]. - The acquisition is expected to address the increasing demand for multi-physics simulation in early design cycles, particularly in the context of electric vehicles and autonomous systems [3].