Quiet Board - what are folks thinking about these days?

Investment Analysis Clubs Jim Royal
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Arbitrage premium now approaching 6.5%. ANSS Stock is up 21+% in just over 2 months.

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Looks like this deal may be caught up in the China-US trade war.

Market Chatter: Synopsys-Ansys Deal Approval Postponed by China Antitrust Regulator

MT Newswires

5:36 AM ET Jun-13-2025

05:36 AM EDT, 06/13/2025 (MT Newswires) – China’s State Administration for Market Regulation has postponed its approval of a proposed merger between Synopsys (SNPS.NaE) and Ansys (ANSS.NaE) , the Financial Times reported, citing two people with knowledge of the matter.

The deal had already entered the last stage of the antitrust regulator’s approval process and was likely to be completed by the end of June, the unnamed sources told the publication.

The delay comes amid a recent decision by the White House to ban chip design software sales by US companies, including Synopsys (SNPS.NaE), to China, according to the report.

The deal approval could still come through if Synopsys (SNPS.NaE) can submit solutions that address the SAMR’s concerns, the FT reported, citing a person familiar with the matter.

Another source reportedly said that the extended approval timeline stems from the deal’s complexity rather than direct links to the ongoing trade war.

Synopsys (SNPS.NaE) and Ansys (ANSS.NaE) did not immediately respond to MT Newswires’ requests for comment.

(Market Chatter news is derived from conversations with market professionals globally. This information is believed to be from reliable sources but may include rumor and speculation. Accuracy is not guaranteed.)

I like that last sentence…

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Ooh, that’s a real snag!

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Thankfully, the lesson was learned prior to pulling the trigger. The lesson being to evaluate the stocks on a standalone basis and be comfortable with them individually even if the deal didn’t close.

So far so good. ANSS is at the same level it was in January. SNPS is maybe 4% lower, but I believe this has more to do with restrictions placed on its activities in China than the deal being held up. A different reason, but still related to the trade war.

Vinnie G

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Arb premium is still around 6.75% - not much change from before the news broke.