According to reports, on February 15th, local time, Japanese chip manufacturer Renesas Electronics announced that it has reached an agreement with the global leading PCB software supplier Altium to acquire all issued shares of Altium, making Altium a wholly-owned subsidiary of Renesas Electronics.
Under the agreement, Renesas Electronics will acquire Altium's shares at a cash price of 68.50 Australian dollars per share, with a total equity value of approximately 9.1 billion Australian dollars (about 5.9 billion US dollars). The acquisition is expected to be completed in the second half of 2024, subject to approval from Altium shareholders, approval from the Australian courts, regulatory approvals, and satisfaction of other conditions.
Altium is a leading global PCB (Printed Circuit Board) software company.
Altium, formerly known as Protel International Limited, was established in 1985. During its Protel phase, the company introduced classic software such as Protel for Dos, Protel for Windows, Protel 99, and Protel 99SE. In 2001, Protel International Limited officially rebranded as Altium.
In the Altium era, following the release of Protel DXP and Protel 2004, the company officially launched Altium Designer 6.0 in 2006, gradually upgrading to Altium Designer 24. The major change from Protel to Altium Designer was the integration, streamlining the process of board-level PCB design. While this may have slightly reduced designers' freedom, it increased standardization, facilitating better design communication and collaboration.
Altium Designer 24 has evolved into a highly efficient and intelligent tool. It provides a smart and intuitive design experience, enabling precise and rapid completion of design tasks to meet the continuously shrinking product development cycles. Altium Designer 24 offers an all-encompassing, user-friendly design environment, allowing effective collaboration and seamless connection between design teams located in different places. It includes tools for managing design rules, advanced routing, rigid-flex, HDI, high-speed, and more, catering to various complexities in PCB design tasks. Each generation of Altium Designer and its predecessor, Protel, has had significant highlights, garnering a loyal user base.
According to statistics from Pedestal Research, Altium is among the top five global PCB software suppliers, ranking fourth, with Siemens EDA, Cadence, and Zuken leading the list and collectively holding a 69% market share. According to Altium's official website, the company is the fastest-growing PCB software service provider, with its revenue growing at a compound annual growth rate of 15.3% from the 2014 fiscal year to the present, except for the 2021 fiscal year. Altium's revenue for the 2023 fiscal year was $2.633 billion, a 19.2% year-on-year increase, with the current subscription base at 61,159, a 7.46% year-on-year growth.
In terms of business coverage, Altium has offices worldwide, with over 800 employees and a rapidly growing channel partner network comprising over 50 authorized value-added distributors. Currently, Altium Designer is used by over 100,000 engineers globally, with leading technology companies such as Siemens, Tesla, and Microsoft among Altium's clients.
In summary, Altium is a highly valuable company and a premium acquisition target.
Renesas Electronics' development mission is "making life easier with technology, dedicated to building a safer, smarter, and sustainable future." Under this mission, Renesas Electronics has consistently expanded its portfolio of embedded processors, analog, power, and connectivity products, aiming to become a global leader in embedded semiconductor solutions.
Renesas Electronics states that the acquisition of Altium will establish an integrated and open "electronic system design and lifecycle management platform." This platform allows collaboration across components, subsystems, and system-level designs, aligning with the company's digitalization strategy and representing a significant step towards enhancing user experience and innovation for electronic system designers.
The acquisition will integrate Altium's rich cloud platform capabilities with Renesas Electronics' robust embedded solutions portfolio, combining high-performance processors, analog, power, and connectivity. This combination will also facilitate seamless integration with third-party vendors across the entire ecosystem, enabling the execution of all electronic design steps in the cloud.
Simultaneously, this acquisition will assist engineers in better leveraging Renesas Electronics' solutions to address the increasingly complex challenges in electronic system design. The current electronic system design process is a complex and rapidly iterative one, involving multiple stakeholders and design steps, from component selection and assessment to simulation and PCB physical design. Engineers must design systems that are not only fully functional but also efficient and cost-effective within gradually shrinking development cycles. The electronic system design and lifecycle management platform jointly developed by Renesas Electronics and Altium can significantly accelerate the pace of innovation and reduce the entry barriers for system designers by minimizing development resources.
Beyond Renesas Electronics' official statements focusing on the company's digital transformation strategy, it's worth noting that acquiring Altium enables Renesas Electronics to transition more effectively from a semiconductor device supplier to a solutions provider, a direction the company has been actively pursuing in recent times. Altium's cloud platform not only accelerates internal solution development for Renesas Electronics but also enhances customer accessibility to these solutions, further elevating the competitiveness of their offerings.
Furthermore, in addition to the ongoing digital upgrade and product form transformation, the widespread adoption of AI is another important aspect. More and more end products are incorporating AI functionalities, a trend referred to as "ubiquitous AI." In this process, computing chips are undoubtedly crucial, but their performance cannot be fully realized without the collaborative involvement of PCBs.
PCBs play a foundational role in the electronic industry chain, serving as the cornerstone for various electronic components and providing stable and reliable electrical connections. High-end PCBs empower more powerful system-level innovations, enabling products to better embrace the era of AI.
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