Cadence withdraws proposal to buy Mentor Graphics

SAN JOSE — Electronic design software maker Cadence Design Systems Inc. on Friday withdrew its offer to buy smaller rival Mentor Graphics Corp.

Cadence, which is based in San Jose, Calif., in June offered to buy Mentor Graphics for $16 per share, or about $1.45 billion.

Cadence said Mentor Graphics' board and management "were unwilling to engage in substantive discussions" on the acquisition, which prevented them from confirming to its lenders the benefits that could be achieved from a deal.

Wilsonville, Ore.-based Mentor Graphics dismissed the criticism, saying Cadence's withdrawal "is inconsistent with both Cadence's recent public statements and recent communications between Mentor Graphics and Cadence."

Mentor Graphics also said it was aware that Cadence was facing difficulty getting financing for the deal.

Cadence shares rose 57 cents, or 8 percent, to $7.73 in afternoon trading, while Mentor Graphics shares fell $3.50, or 25 percent, to $10.50.

Cadence said that its board authorized adding $500 million to its stock buyback plan. The company is now authorized to repurchase up to $912 million in common shares.

Back To Top