Summary
Synopsys, Inc. (SNPS) filed an 8-K on February 22, 2012, reporting two significant events: the entry into an amended and restated credit agreement and the completion of its acquisition of Magma Design Automation, Inc. The new credit facility includes a $350 million senior unsecured revolving credit facility and a $150 million senior unsecured term loan facility, with an option to increase the revolving facility by an additional $150 million. This new term loan was specifically added to finance part of the Magma acquisition. The acquisition of Magma was completed on February 22, 2012, with Magma shareholders receiving $7.35 in cash per share. The total merger consideration was funded through existing cash reserves and borrowings under the newly established credit agreement. This marks a significant strategic move for Synopsys, expanding its business through acquisition.
Key Highlights
- 1Entry into an amended and restated credit agreement totaling $500 million ($350M revolving, $150M term loan), with potential for an additional $150M revolving commitment.
- 2The new credit facility was used, in part, to finance the acquisition of Magma Design Automation, Inc.
- 3Completion of the acquisition of Magma Design Automation, Inc. on February 22, 2012.
- 4Magma shareholders received $7.35 in cash per share for their common stock.
- 5The acquisition was funded by existing cash and new borrowings under the credit agreement.
- 6The credit agreement includes financial covenants such as maximum leverage ratio and minimum cash levels.
- 7The credit agreement terminates on October 14, 2016, with variable interest rates and applicable margins based on Synopsys' leverage ratio.