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FILED BY:
Innoveda, Inc.
SUBJECT COMPANIES:
Innoveda, Inc. (Commission File No.: 000-20923
PADS Software, Inc. (Commission File No.: N/A)
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Contact Information
NORTH AMERICA: EUROPE/MIDDLE EAST: ASIA PACIFIC: INVESTOR RELATIONS
Ed Canty Sarah Miller Peter van der Sluijs Junko Kaneko 508.303.5507
508.303.5291 508.303.5254 +44 1442 879222 03(3364)5531 [email protected]
[email protected] [email protected] [email protected] [email protected]
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INNOVEDA AND PADS SOFTWARE ANNOUNCE MERGER AGREEMENT
MARLBORO, MASS. - JUNE 2, 2000 - Innoveda, Inc. (Nasdaq: INOV) today announced
it has entered into a definitive merger agreement to acquire PADS Software,
Inc., a privately held company. In the transaction, valued at approximately U.S.
$32 million, a total of approximately 6.5 million shares of Innoveda stock and
approximately U.S. $2 million will be exchanged for all PADS outstanding stock.
In addition, Innoveda will assume all outstanding options to purchase PADS
stock.
Together, the companies will be positioned to deliver a comprehensive
environment for printed circuit board (PCB) and advanced IC packaging design, in
addition to Innoveda's other environments for system-level design, design
capture and electromechanical design. The environments are backed by Innoveda's
comprehensive consulting services, and sold through an experienced worldwide
direct sales force and Value Added Reseller (VAR) channel.
Innoveda is a leader in electronic product design solutions and PADS is
widely recognized for its PCB design software. Both companies are leaders in the
Electronic Design Automation (EDA) industry and provide software tools and
services to engineers who design complex electronic systems sold by companies
that participate in the telecommunications, computer, transportation and
consumer electronics markets.
The announcement comes two months after Viewlogic Systems, Inc. and
Summit Design, Inc. completed their merger to become Innoveda.
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MARKET-DEFINING MOVE
William J. (Will) Herman, Innoveda president and CEO, said the merger
"will create a powerhouse in PCB systems design" to address the increasing
complexity engineers face in developing differentiable end-products and
delivering them to market ahead of competitors. "Today's electronic products
contain fast, highly complex components that are frequently mounted on
multi-layer, high-density printed circuit boards and advanced packages such as
ball grid arrays (BGAs) and chip scale packages (CSPs). The need for high-speed,
accurate routing and electrical analysis tools, which can prevent costly
problems downstream in the manufacturing process, has never been greater," he
said.
NEW INNOVEDA OFFERINGS
Through the merger, Innoveda plans to offer a complete printed
circuit board and advanced packaging design environment that includes tools
for interconnect planning, component placement, layout and automatic routing;
high-speed analysis; and board fabrication auditing and optimization tools.
SEAMLESS TRANSITION
Ken Tepper, president and CEO of PADS, called the merger a "win/win"
for Innoveda and PADS customers. Both companies' product sets are complementary.
"This is a model of what a merger should be, with clear product synergies and
minimal overlap. We expect the transition to be relatively seamless. Our
cultures are very similar and we gain immediate synergies with our VARs as well,
because they already have been selling many of Innoveda's products.
"The merger elevates PADS from a mainstream point-tool supplier to an
integral part of a full solutions provider for electronic product design,"
Tepper said. "I think it is important for PADS customers to know that Innoveda
intends to retain the PADS management team and we will be working to integrate
our product lines with Innoveda to deliver a complete PCB solution."
PADS GROWTH
Founded in 1986, PADS has grown its revenues an average of 23 percent
annually for the past seven years, exceeding the growth of the overall EDA
market during that
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period. The company achieved revenues of U.S. $25.7 million in 1999. PADS has a
user base of 62,000 spanning 45 countries.
COMPLETING THE VISION
According to Dan Ganousis, Innoveda's senior vice president of
worldwide marketing and consulting services, "the merger represents the next
step in Innoveda's strategy to provide innovative tools, design environments and
consulting services that enable its customers to `visualize, design and build'
complex electronic systems. PADS completes the `build' portion of our vision.
"The powerful Visual HDL(TM) and Virtual-CPU(TM) tools allow engineers
to `visualize' their designs at the architectural level," said Ganousis.
"ViewDraw(R), a premier schematic capture tool, and the Design Exchange(TM)
family of tools that enables Internet-based collaboration and communication are
key elements of the `design' stage. In the `build' stage, Innoveda's ePlanner
interconnect planning tool provides the PCB designer with a `what-if'
environment that allows optimal termination and placement strategies to be
determined prior to physical design. Innoveda will add PADS' PowerPCB(TM) design
environment, which includes BlazeRouter(TM), the industry's newest and
feature-rich autorouter; PowerBGA for physical design at the IC package level;
and HyperLynx(TM), which along with XTK(TM) provides a comprehensive signal
integrity analysis offering. Designers can use the PADS' CAM 350(TM) family of
tools to optimize PCB databases to drive bare board fabrication and test
processes. In parallel with the PCB design process, designers use Innoveda's
electromechanical environment to design, route and analyze wire and cable
harnesses.
COMPETITIVE ADVANTAGE
"The addition of HyperLynx will allow us to penetrate virtually all
entry points in the fast-growing SI market segment," said Ganousis. "The
technology base created by HyperLynx and XTK, along with BlazeRouter and the new
Latium architecture, will give us a strong foundation for moving to the next
generation of PCB design technology.
"BlazeRouter and the Latium architecture were key factors in our
decision to merge with PADS. BlazeRouter has the latest router technology, and
now we have the opportunity to integrate our high-speed analysis products with
this tool to address the needs of tomorrow's high-performance PCB designs.
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"We're excited about the possibility of offering a comprehensive
printed circuit board design solution. Innoveda will provide a complete pre-and
post-layout analysis environment for static timing, Electromagnetic Interference
(EMI), signal integrity, power plane analysis and manufacturing interfaces that
decrease cycle time and eliminate design spins. We believe no other company
offers this breadth and depth of capability," Ganousis added.
MANUFACTURING ALLIANCE
The merger of the two companies will also result in an alliance between
Innoveda and Kyoden Ltd., PADS' former major shareholder and major bare board
PCB manufacturer in Japan. The alliance will enable both companies to promote a
complete flow from product visualization to product realization providing
further differentiation from competitive offerings.
TERMS OF THE MERGER
There will be no adjustment to merger consideration for changes in
Innoveda stock price prior to the closing. The merger will be accounted for as a
purchase. The boards of directors at both companies have approved the merger. It
is subject to approval of PADS shareholders, customary SEC and other regulatory
approvals, and closing conditions. The transaction is intended to qualify as a
tax-free reorganization. Innoveda expects a one-time charge related to certain
acquisition and related expenses in the quarter in which the transaction closes.
ABOUT PADS
PADS Software, Inc. is a worldwide supplier of software that aids in
the design, layout, verification and manufacturing of printed interconnect
systems that are used in electronic products. The company is focused on
providing sophisticated, comprehensive products that offer the flexibility and
price/performance advantage of Windows-based tools. PADS also offers solutions
for printed circuit fabrication with its Advanced CAM Technologies (ACT) product
line and design verification products with its HyperLynx product line.
ABOUT INNOVEDA
Innoveda, Inc. (Nasdaq: INOV) is a leading provider of innovative
software and services that help engineers visualize, design and build advanced
electronic systems. In
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March 2000, the company was formed through the merger of Viewlogic Systems, Inc.
and Summit Design, Inc. Previously, Viewlogic acquired Transcendent Design
Technology, Inc. These transactions formed the foundation of Innoveda's
comprehensive eProduct (electronic product) solutions for system-level design,
design capture, board design and electromechanical design. Headquartered in
Marlboro, Mass., Innoveda has offices worldwide.
FORWARD-LOOKING STATEMENTS
This press release includes forward-looking statements that are subject
to a number of risks and uncertainties. All statements, other than statements of
historical facts included in this press release, regarding Innoveda's strategy,
future operations, financial position, prospects, plans, goals and objectives of
management are forward-looking statements. When used in this press release, the
words "will", "believe", "anticipate", "intend", "estimate", "expect",
"project", "plan" and similar expressions are intended to identify
forward-looking statements, although not all forward-looking statements contain
these identifying words. We cannot guarantee future results, levels of activity,
performance or achievements, and you should not place undue reliance on our
forward-looking statements. Our forward-looking statements do not reflect the
potential impact of any future transactions or strategic alliances.
Our actual results could differ materially from those anticipated in
these forward -looking statements as a result of various factors, including
obtaining stockholder approval and the satisfaction of other conditions to
closing the merger, the ability of Innoveda to successfully integrate the
operations of PADS, the acceptance of the combined companies' products in the
marketplace, the ability of Innoveda to successfully develop new products, and
the other risks described in the registration statement on Form S-4 (File No.
333-89491) filed on October 22, 1999, as amended, in Innoveda's most recent
quarterly report on Form 10-Q and annual report on Form 10-K and other public
filings made by Innoveda with the Securities and Exchange Commission, which
factors are incorporated herein by reference.
ADDITIONAL INFORMATION AND WHERE TO FIND IT
Innoveda intends to file a Registration Statement on Form S-4 in
connection with its acquisition of PADS and PADS expects to mail a Proxy
Statement/Prospectus to its
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stockholders containing information about the merger. Investors and stockholders
are urged to read the Registration Statement and the Proxy Statement/Prospectus,
when they become available. The Registration Statement and the Proxy
Statement/Prospectus will contain important information about Innoveda, PADS,
the merger and other related matters. Investors and stockholders will be able to
obtain free copies of the Registration Statement and the Proxy
Statement/Prospectus, when filed, through the web site maintained by the United
States Securities and Exchange Commission at http://www.sec.gov. Free copies of
the Registration Statement and the Proxy Statement/Prospectus, excluding
exhibits, may also be obtained from Innoveda, when available, by directing a
request to Innoveda, Inc., 293 Boston Post Road West, Marlboro, Massachusetts
01752, Attention: Peter T. Johnson., telephone: (508) 480-0888.
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Editor's note: All trademarks and registered trademarks are the property of
their respective owners.
