Acquisitions

3 Months Ended

Apr. 03, 2021

On February 23, 2021, Cadence acquired all of the outstanding equity of Belgium-based Numerical Mechanics Applications International SA (“NUMECA”). The addition of NUMECA’s technologies and talent supports Cadence’s Intelligent System Design™ strategy, servicing the computational fluid dynamics (“CFD”) market segment as part of System Design and Analysis. The aggregate cash consideration for Cadence’s acquisition of NUMECA, net of cash acquired of $9.5 million, was $189.3 million. Cadence expects to recognize expense for consideration paid to certain former NUMECA shareholders that is subject to service and other conditions, through the first quarter of fiscal 2023.

The total purchase consideration was allocated to the assets acquired and liabilities assumed based on their respective estimated fair values on the acquisition dates as follows:


	Fair Value
	(In thousands)
Current assets	$	16,423
Goodwill	133,326
Acquired intangibles	72,200
Other long-term assets	6,928
Total assets acquired	228,877
Current liabilities	9,951
Long-term liabilities	20,091
Total liabilities assumed	30,042
Total purchase consideration	$	198,835

The allocation of purchase consideration to certain assets and liabilities has not been finalized. Cadence will continue to evaluate certain estimates and assumptions, primarily related to taxes and assumed liabilities, during the measurement period (up to one year from the acquisition date). The recorded goodwill is attributed to intangible assets that do not qualify for separate recognition, including the acquired assembled workforce and expected synergies from combining operations of NUMECA with Cadence. Cadence has not completed its assessment to determine whether the goodwill will be deductible for tax purposes.

Acquired intangibles


	Fair Value		Weighted-Average Amortization Period
	(In thousands)		(in years)
Existing technology	$	47,000	15.0 years
Agreements and relationships	21,200		14.0 years
Tradenames, trademarks and patents	4,000		15.0 years
Total acquired intangibles with definite lives	$	72,200	14.7 years

Cadence has not presented pro forma financial information for NUMECA because the results of operations for NUMECA are not material to Cadence’s condensed consolidated financial statements. During the three months ended April 3, 2021, and the three months ended March 28, 2020, transaction costs associated with acquisitions were not material and were expensed as incurred.