With UK approval in hand, Synopsys edges closer to completing $35bn Ansys deal

The proposed $35 billion acquisition of ANSYS, Inc. by Synopsys, Inc. has crossed a major regulatory milestone as the United Kingdom’s Competition and Markets Authority formally closed its merger inquiry. The case closure followed the successful divestment of overlapping business lines, a key condition imposed by the CMA to address antitrust concerns around power analysis and photonics simulation software.

The decision removes one of the final remaining obstacles for Synopsys to complete its takeover of the simulation software major, a deal first announced in January 2024. The regulatory clearance is seen as a pivotal development in a broader global trend toward full-stack integration in semiconductor design and system simulation.

The transaction combines Synopsys’s leadership in electronic design automation with ANSYS’s strength in multi-physics simulation, giving the merged entity unprecedented reach across chip-to-system engineering workflows. But that breadth also triggered heightened scrutiny from antitrust regulators across multiple jurisdictions.

Why did the UK watchdog scrutinize the Synopsys–Ansys merger?

The Competition and Markets Authority initiated a formal Phase 1 investigation into the merger in 2024 after identifying overlapping areas of competition in highly specialized software categories. The CMA’s analysis flagged three main product areas as potential antitrust concerns: RTL power analysis, photonics simulation, and optical modeling tools.

At the center of the issue was ANSYS’s PowerArtist tool, widely used for analyzing power consumption at the register-transfer level during chip design. This was considered a direct competitor to existing solutions within Synopsys’s EDA stack. Additionally, both companies had offerings in the optics and photonics space, including simulation software used for devices such as lasers, sensors, and silicon photonics components.

Regulators warned that allowing Synopsys to retain control over both portfolios could weaken competition, potentially leading to reduced innovation, higher prices, and fewer choices for chipmakers and system designers. The December 2024 findings from the CMA concluded that the transaction, as originally structured, could lead to a substantial lessening of competition in these categories.

What actions did Synopsys and Ansys take to resolve the UK antitrust issues?

To avoid a lengthy Phase 2 review, Synopsys and ANSYS proposed structural remedies in the form of targeted divestitures. These included the sale of ANSYS’s PowerArtist business and Synopsys’s entire photonics and optics simulation division, which was consolidated as a carve-out called the Optical Solutions Group.

Keysight Technologies, Inc. was selected as the buyer of these assets. With a robust presence in test and measurement technologies and an established customer base in electronic design software, Keysight was seen by regulators as a capable and credible acquirer that could sustain competition in the affected segments.

The CMA accepted the undertakings in lieu of reference in March 2025 after holding consultations and assessing third-party feedback. Completion of the sale to Keysight occurred in October 2025. Following the divestment and verification of transitional measures, the CMA formally ended its merger inquiry on 27 November 2025.

Regulators emphasized that the divested businesses were operationally viable, came with staff and infrastructure, and were transferred in a way that enabled the buyer to immediately compete in the market. Institutional analysts covering EDA and simulation software considered the deal structure a textbook example of how complex software M&A can navigate regulatory hurdles through carve-outs that preserve innovation and choice.

How does the UK ruling align with global regulatory outcomes?

The UK’s approval is one of several key endorsements of the Synopsys–Ansys merger by antitrust agencies around the world. The European Commission had raised similar objections to overlapping software offerings and accepted the same package of divestitures to Keysight as sufficient to address competition concerns.

In China, the State Administration for Market Regulation cleared the deal without requiring further remedies. Observers noted that China’s regulatory focus was more aligned with maintaining technology access and encouraging simulation adoption within domestic industry, rather than preserving existing global competition in niche software markets.

In the United States, the Federal Trade Commission has yet to issue a final decision. However, sources familiar with the process believe the UK and EU outcomes will likely influence the FTC’s stance. With structural remedies already implemented and a credible third-party buyer in place, the FTC is expected to either clear the deal or negotiate a consent decree mirroring those accepted elsewhere.

Analysts following regulatory behavior across jurisdictions say the case could set a precedent for software M&A, where intellectual property and R&D overlap, rather than direct product competition, drive antitrust risk. In such scenarios, timely divestitures to industry incumbents could become the preferred solution.

What does the merger mean for EDA and simulation software innovation?

By combining Synopsys’s suite of digital, analog, and verification EDA tools with ANSYS’s simulation capabilities in thermal, structural, and electromagnetic domains, the merged entity will offer one of the industry’s most comprehensive engineering software platforms. This convergence is expected to benefit sectors requiring tight co-design between chips and physical systems, including automotive, aerospace, telecommunications, and industrial automation.

The integration aligns with customer demand for early-stage co-simulation, where thermal performance, electromagnetic interference, and power efficiency must be evaluated in tandem with logic and layout. Synopsys’s AI-based design flows, including tools driven by its DSO.ai platform, are likely to gain deeper context and accuracy when augmented with ANSYS’s physics-based modeling.

However, some enterprise customers have expressed concerns about vendor lock-in and pricing power. Multi-tool workflows that previously involved mixing software from ANSYS, Synopsys, and Cadence Design Systems may now need revalidation, especially in regulated environments like defense and medical devices.

Rival companies such as Siemens EDA and Cadence are also likely to respond with increased integration efforts, either through organic R&D or acquisitions targeting simulation-adjacent capabilities.

How is the market interpreting the regulatory progress and closing trajectory?

Following the CMA’s announcement that the divestment condition had been fulfilled, shares of Synopsys and ANSYS responded with moderate gains, reflecting market confidence that the transaction is on track to close in early 2026. As of the final week of November 2025, Synopsys stock has appreciated by approximately 8 percent over the prior three months, while ANSYS has recorded a 6 percent rise.

Institutional investors have generally viewed the deal as accretive, particularly given the size of the engineering software total addressable market, estimated by Synopsys to exceed $100 billion. Sell-side analysts have issued positive forward guidance based on expected cross-selling opportunities and expansion into high-growth sectors such as automotive electrification and 6G systems.

Some hedge funds and activist firms had initially speculated about potential delays or concessions that could impact the deal’s valuation. But the clean closure of the UK inquiry, combined with earlier approvals in Europe and China, has eased those concerns.

Industry insiders expect the remaining integration work to focus on product portfolio rationalization, cloud-based delivery models, and developer unification across R&D teams based in North America, Europe, and India.

What comes next as Synopsys prepares for full integration of Ansys?

With structural remedies complete and the UK inquiry closed, Synopsys is now positioned to finalize the Ansys acquisition pending remaining procedural approvals. The merger is expected to close in early 2026, barring any late-stage regulatory delays in the United States.

Key integration priorities will include harmonizing go-to-market strategies, especially for large enterprise accounts that previously maintained separate licensing models for Synopsys and ANSYS products. The development of a unified cloud-native platform that brings together EDA and simulation workflows will also be a strategic focus.

Further down the roadmap, Synopsys may extend its reach into areas like digital twin development, smart factory simulation, and power-aware verification for AI and edge inference chips. These use cases require tight coupling of software, hardware, and physics models, positioning the combined firm well against evolving customer needs.

The merger is also expected to put pressure on competitors to deepen their product portfolios and invest in cross-domain workflows. As engineering teams increasingly demand simulation-first approaches that reduce tape-out risk and accelerate time-to-market, vendor differentiation will hinge on full-stack capability and toolchain interoperability.

What are the key takeaways from the UK approval of the Synopsys–Ansys merger?

• The United Kingdom’s Competition and Markets Authority formally ended its merger inquiry into Synopsys’s $35 billion acquisition of ANSYS after structural divestments were completed.

• Synopsys divested its Optical Solutions Group, and ANSYS divested PowerArtist, with both business units acquired by Keysight Technologies to address antitrust concerns.

• The divestitures resolved competition issues in RTL power analysis, photonics simulation, and optical modeling software markets.

• The European Commission had previously accepted the same remedy package, and China’s regulator cleared the deal without requiring divestments.

• United States regulatory clearance remains pending, but analysts believe the precedent from the UK and EU makes approval likely.

• The merger enables Synopsys to offer an end-to-end design and simulation platform spanning chip, system, and multi-physics domains.

• Institutional sentiment remains positive, with Synopsys and ANSYS stocks both rising steadily in the three months leading up to the UK clearance.

• The combined entity is expected to drive innovation in co-design tools across high-growth industries like aerospace, automotive, and AI infrastructure.

• Rivals such as Siemens EDA and Cadence Design Systems may respond with their own integration plays to remain competitive.

• Synopsys expects to finalize the merger in early 2026, with post-closing focus on cloud-based delivery, product unification, and cross-selling synergies.