Risk
3/25/2014
10:45 AM
Dark Reading
Dark Reading
Products and Releases
Connect Directly
RSS
E-Mail
50%
50%

Synopsys Completes Coverity Acquisition

Companies intend to improve software quality and help ensure mission-critical applications are built to withstand increasing security threats

MOUNTAIN VIEW, Calif., March 25, 2014 /PRNewswire/ -- Synopsys, Inc.

(Nasdaq:SNPS), a global leader providing software, IP and services used to accelerate innovation in chips and electronic systems, has completed its acquisition of Coverity, the leading provider of software quality, testing and security tools. The value of the transaction is approximately $334 million net of cash acquired, which Synopsys is funding using a combination of cash and approximately $200 million in debt.

Coverity products reduce the risk of quality and security defects, which can lead to the catastrophic failures that plague many of today's large software systems. Together, Synopsys and Coverity intend to improve software quality and help ensure mission-critical applications are built to withstand increasing security threats.

With this acquisition Synopsys enters a new, growing market geared toward enterprise IT and independent software providers in industries such as financial services, energy, entertainment and retail. The acquisition also opens up opportunities for Synopsys to increase its breadth and support to the semiconductor and systems space. To address the needs of software developers across the board, Synopsys will invest in delivering innovations in quality and security testing that can further reduce the risk of software failures and security breaches.

Based on a preliminary analysis, due to the impact of purchase accounting and the associated deferred revenue haircut, Synopsys anticipates the acquisition to contribute approximately $20-25 million to fiscal 2014 revenue. Therefore, Synopsys would expect the transaction to be approximately $0.10-0.13 per share dilutive in fiscal 2014, be roughly neutral in the second half of fiscal 2015, and accretive in fiscal 2016 (all on a non-GAAP basis). Synopsys anticipates including specific guidance that includes the impact of Coverity when we report fiscal second quarter results in May.

Coverity will be led by John Chilton, senior vice president and general manager for Coverity.

About Synopsys

Synopsys, Inc. (Nasdaq:SNPS) accelerates innovation in the global electronics market. As a leader in electronic design automation (EDA) and semiconductor IP, Synopsys delivers software, IP and services to help engineers address their design, verification, system and manufacturing challenges. Since 1986, engineers around the world have been using Synopsys technology to design and create billions of chips and systems. Learn more at www.synopsys.com. For more information on Coverity, visit www.coverity.com.

Forward-Looking Statements

This press release contains forward-looking statements within the meaning of Section 21E of the Securities Exchange Act of 1934 regarding the acquisition of Coverity, including the expected impact of the transaction on Synopsys'

financial results, the expected benefits and costs of the transaction, Synopsys'

plans for Coverity products, and the expected growth of the new market. Any statements that are not statements of historical fact may be deemed to be forward-looking statements. These statements involve known and unknown risks, uncertainties and other factors that could cause actual results, time frames or achievements to differ materially from those expressed or implied in the forward-looking statements. Accordingly, we caution stockholders and prospective investors not to place undue reliance on these statements. Such risks, uncertainties and factors include, but are not limited to:

-- the possibility that the anticipated benefits of the transaction may not

materialize;

-- Synopsys' ability to operate or integrate Coverity's business and

technologies with its own successfully, including with the potential

loss of customers, key employees, partners or vendors;

-- the failure of acquired products to achieve projected sales, including

uncertain customer demand and support obligations for new offerings;

-- difficulties entering into new markets in which Synopsys is not

experienced;

-- assumption of unknown liabilities and the related expenses and diversion

of resources;

-- dilution of Synopsys' current stockholders through the issuance of

common stock upon the exercise of stock options assumed in the

transaction; and

-- other risks and uncertainties described in SEC filings made by Synopsys

from time to time, including those described in the "Risk Factors"

section of Synopsys' most recently filed Quarterly Report on Form 10-Q.

Synopsys' press release issued on February 19, 2014 announcing the results of its first quarter of fiscal 2014 contains a reconciliation of target non-GAAP earnings per share to target GAAP earnings per share. Synopsys has not completed its valuation and purchase price allocation analyses for the Coverity acquisition, and we cannot at this time reliably forecast acquisition-related costs and amortization of acquisition-related intangible assets, which are difficult to predict and estimate. As a result, we are unable to determine the full impact of the Coverity acquisition on forward-looking target GAAP earnings per share at this time and are therefore unable to provide a quantitative reconciliation of the impact of the Coverity acquisition on forward-looking non-GAAP earnings per share, disclosed above, to forward-looking GAAP earnings per share. We are therefore not making changes to the GAAP earnings per share targets and the related GAAP to non-GAAP reconciliation we provided on February 19, 2014.

Comment  | 
Print  | 
More Insights
Register for Dark Reading Newsletters
Partner Perspectives
What's This?
In a digital world inundated with advanced security threats, Intel Security seeks to transform how we live and work to keep our information secure. Through hardware and software development, Intel Security delivers robust solutions that integrate security into every layer of every digital device. In combining the security expertise of McAfee with the innovation, performance, and trust of Intel, this vision becomes a reality.

As we rely on technology to enhance our everyday and business life, we must too consider the security of the intellectual property and confidential data that is housed on these devices. As we increase the number of devices we use, we increase the number of gateways and opportunity for security threats. Intel Security takes the “security connected” approach to ensure that every device is secure, and that all security solutions are seamlessly integrated.
Featured Writers
White Papers
Cartoon
Current Issue
Dark Reading's October Tech Digest
Fast data analysis can stymie attacks and strengthen enterprise security. Does your team have the data smarts?
Flash Poll
Video
Slideshows
Twitter Feed
Dark Reading - Bug Report
Bug Report
Enterprise Vulnerabilities
From DHS/US-CERT's National Vulnerability Database
CVE-2014-0619
Published: 2014-10-23
Untrusted search path vulnerability in Hamster Free ZIP Archiver 2.0.1.7 allows local users to execute arbitrary code and conduct DLL hijacking attacks via a Trojan horse dwmapi.dll that is located in the current working directory.

CVE-2014-2230
Published: 2014-10-23
Open redirect vulnerability in the header function in adclick.php in OpenX 2.8.10 and earlier allows remote attackers to redirect users to arbitrary web sites and conduct phishing attacks via a URL in the (1) dest parameter to adclick.php or (2) _maxdest parameter to ck.php.

CVE-2014-7281
Published: 2014-10-23
Cross-site request forgery (CSRF) vulnerability in Shenzhen Tenda Technology Tenda A32 Router with firmware 5.07.53_CN allows remote attackers to hijack the authentication of administrators for requests that reboot the device via a request to goform/SysToolReboot.

CVE-2014-7292
Published: 2014-10-23
Open redirect vulnerability in the Click-Through feature in Newtelligence dasBlog 2.1 (2.1.8102.813), 2.2 (2.2.8279.16125), and 2.3 (2.3.9074.18820) allows remote attackers to redirect users to arbitrary web sites and conduct phishing attacks via a URL in the url parameter to ct.ashx.

CVE-2014-8071
Published: 2014-10-23
Multiple cross-site scripting (XSS) vulnerabilities in OpenMRS 2.1 Standalone Edition allow remote attackers to inject arbitrary web script or HTML via the (1) givenName, (2) familyName, (3) address1, or (4) address2 parameter to registrationapp/registerPatient.page; the (5) comment parameter to all...

Best of the Web
Dark Reading Radio
Archived Dark Reading Radio
Follow Dark Reading editors into the field as they talk with noted experts from the security world.