Primarius Technologies, a Chinese electronic design automation (EDA) company that is publicly traded, announced on March 27 that it would acquire equity in Chengdu Analog Circuit Technology (Actt), a fellow Chinese firm, through a combination of cash payment and share issuance.
This acquisition is in line with Empyrean Technology's recent acquisition of Xpeedic, suggesting that the local EDA industry in China is undergoing accelerated consolidation.
Primarius and Actt have executed a share acquisition intent agreement, as indicated by the public disclosure.
Actt leads China in analog and mixed-signal IP
Actt is based in Chengdu and has offices in Shenzhen, Shanghai, Nanjing, and additional cities. The company specializes in the design, licensing, and associated services of intellectual property (IP) pertaining to ICk, including analog and mixed-signal chips, embedded memory, wireless radio frequency communication, and wired connectivity interface devices.
According to the IPnest 2023 report, Actt placed first in China for analog and mixed-signal IP, with wireless radio frequency communication and embedded memory IP also ranking high in the Chinese market.
Actt is also one of the top ten physical IP vendors, offering a complete suite of low-power analog IPs such as Bandgap, LDO, PMU, OSC, PLL, and others, as well as a high-performance ADC/DAC series. In terms of embedded memory IP, the company focuses on high-reliability storage technology used in automotive electronics, industrial control, and other industries. Its wireless radio frequency communication IP and cable connectivity interface IP meet a variety of high-speed interface requirements.
Actt has over 140 patents outside of China and has formed collaborations with over 30 worldwide foundries. Its technologies purportedly include CMOS, eFlash, BCD, HV, SiGe, and FD-SOI processes spanning from 5 to 180 nanometers.
Actt filed for an initial public offering (IPO) on the Shanghai Stock Exchange STAR Market in June 2022, which was accepted but voluntarily withdrawn in March 2023. Actt then relaunched its A-share listing plan, completing registration for guidance in August 2023. However, due to issues such as patent lawsuits, its IPO was eventually unsuccessful.
Government M&A push
As the Chinese EDA sector evolves from its first phase of rapid expansion to more mature development, businesses are redirecting their emphasis from achieving breakthroughs from zero to one towards fostering growth and integration from one to one hundred.
The Chinese government is promoting mergers and resource integration among firms to improve competitiveness in the industry. In recent years, as market funding has diminished, IPO evaluations have intensified, and the general market has deteriorated, numerous companies have encountered survival difficulties. Mergers and acquisitions aimed at enhancing competitiveness have emerged as a viable survival strategy for Chinese enterprises.
Primarius' acquisition of Actt will facilitate the transition of the local EDA industry in China from its initial chaotic development to a more cohesive industrial ecosystem, thereby enhancing the market competitiveness of Chinese homegrown EDA firms.
Article edited by Jack Wu
