Electronic Design Automation services company Duet Technologies Inc is aiming to provide a one stop shop for chip designers and may go on to challenge the likes of Cadence Design Systems Inc with the announcement today of its acquisition of Cascade Design Automation Corp. Bellevue, Washington-based Cascade is a supplier of integrated circuit libraries. It began life in 1986 as Seattle Silicon Corp, and in 1991 was bought by Japan’s Oki Electric Industry Co Ltd. Duet is basically a people company, providing consultancy and human resources to semiconductor designers and builders. Thomas Quan, Duet’s vice president of marketing says with the industry driving more and more functionality onto ever smaller chips, there is a huge demand for skilled engineers. The new combined company boasts 450 staff, of whom 350 are engineers. Both Duet and Cascade are privately held companies, and financial details of the deal have not been disclosed. However, Duet’s founder and chairman Prabhu Goel is not unknown to the US investment community, having founded Gateway Semiconductor which he sold to Cadence for $80m, and then set up a company called Frontline which he sold to Avant! Corp for $76m before setting up Duet. In order to meet the deadlines set by Oki for completing the acquisition by last Friday, Goel, who obviously still has some spare cash lying around, apparently threatened to ‘sign the whole check’ himself if investors could not come up with the money in time. This evidently concentrated minds, and the company ended up being offered three times the amount required. Duet was planning to go public before the acquisition, and now says this will probably happen at the end of the year. The sector has been given a boost with the recent Initial Public Offering of one of Cascade’s competitors, Artisan Components Inc, a company with revenue of some $9m whose IPO gave it a market capitalization of $200m. Cascade’s revenue at around $18m is twice that of Artisan. Deep sub-micron chip technology, 0.25 and below, being driven by the need for smaller faster chips, requires almost twice the IC libraries of that of 0.35. One driver of this according to Quan, is Intel Corp’s move to 100Mhz buses from 66Mhz, in order to optimize processor speed. Most peripherals, he says, will have to be redesigned to work with the 100Mhz bus, and this means people and libraries have to be thrown at the job. One factor driving Duet’s business is the growing need to re-use semiconductor intellectual property, and the need to optimize investment by making minor design changes in order to address new markets. As well as the IC libraries, Cascade also has some electronic design automation software, which, combined with Duet’s services skills, leads Quan to speculate that the new company may be moving in to Cadence’s design automation tools space. Duet currently gets only 10% of its business outside the US, but Cascade has a presence in the UK, Europe and in Japan, and the company will exploit this to help it expand into these areas.
