Chip design software maker Mentor Graphics Corp. (NASDAQ:MENT)
said Thursday it has agreed to buy LogicVision Inc. (NASDAQ:LGVN) for $13 million in stock.
The deal follows a failed attempt by Virage Logic Corp. (NASDAQ:VIRL) to buy LogicVision for $10 million late last year. Virage
gave up its pursuit of the unwilling target in December. LogicVision had spent most orf 2008 reviewing its strategic alternatives with the help of Needham & Co.
The terms of the deal call for each LogicVision shares to receive .2006 Mentor shares. This values LogicVision shares at $1.42 based on Mentor's Wednesday closing share price and represents a 53% premium over the target's closing price Wednesday.
LogicVision shares climbed 40%, to $1.30 apiece, in Thursday morning trading.
The company's software enables chip designers to embed self-test capabilities into semiconductor designs. Last month it reported a first-quarter net loss of $104,000 on revenues of $3.1 million.
The deal is Mentor's first relatively sizable acquisition since it
fended off a $1.6 billion hostile bid from rival Cadence Design Systems Inc. (NASDAQ:CDNS) last year. The company acquired Flomerics Group plc, a U.K. maker of fluid dynamics analysis products, in October.
Mentor shares slid 5%, to $6.72, in morning trading Thursday.
- Olaf de Senerpont Domis
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