Cadence to Acquire Hexagon’s Design & Engineering Business, Expanding Leadership in System Design and Multiphysics Simulation
Cadence (Nasdaq: CDNS) has announced a definitive agreement to acquire the Design & Engineering (D&E) business of Hexagon AB, including its flagship MSC Software division—a pioneer in engineering simulation and analysis solutions. This strategic acquisition accelerates Cadence’s Intelligent System Design™ strategy, significantly expanding its System Design & Analysis portfolio and reinforcing its commitment to addressing the world’s most complex design challenges. The addition of Hexagon’s D&E technology and talent builds on Cadence’s 2024 acquisition of Beta CAE, enabling deeper penetration into the multi-billion-dollar structural analysis market.
Under the terms of the agreement, Cadence will pay approximately €2.7 billion for the business, with 70% of the consideration paid in cash and 30% through the issuance of Cadence common stock to Hexagon. This transaction underscores Cadence’s focus on delivering comprehensive, end-to-end multiphysics solutions that meet the growing demand for electrical-mechanical hyperconvergence in industries such as automotive, aerospace, industrial, and robotics.
Addressing the Growing Need for Multiphysics Simulations
The rapid convergence of electrical and mechanical systems is driving increased demand for multiphysics simulations earlier in the design cycle. Leveraging its expertise in computational software, Cadence has steadily expanded its system analysis portfolio to include electromagnetics, electrothermal, and computational fluid dynamics (CFD). The acquisition of Beta CAE established a foundational presence in structural analysis, and the addition of Hexagon’s D&E business further enhances this position by integrating world-class mechanical solvers into Cadence’s platform.
Hexagon’s D&E business is renowned for its flagship products, MSC Nastran and Adams, which are industry standards in structural and multibody dynamics simulation. These tools are critical for designing and validating complex mechanical systems, particularly in aerospace and automotive applications where performance, precision, and reliability are non-negotiable. Adams’ multibody dynamics capabilities are also poised to play a pivotal role in emerging fields such as robotics and physical AI, where accurate simulation of real-world motion and interactions is essential.
The acquisition brings an impressive portfolio of complementary solutions in multiphysics analysis, system dynamics, metal forming, and autonomous driving simulation. Together, these technologies will enable Cadence to deliver a unified, end-to-end multiphysics platform that addresses the increasingly complex needs of modern engineering workflows.
Expanding Cadence’s Vision of Intelligent System Design
“Cadence has long been at the forefront of innovation in computational software for semiconductors and electronic systems,” said Anirudh Devgan, Cadence’s president and chief executive officer. “By adding Hexagon’s D&E world-class simulation capabilities, we will expand our vision of Intelligent System Design to encompass the full spectrum of physical behavior—from electromagnetics and fluids to structures and motion. This will be a pivotal step in enabling our customers to design the complex, converged systems of tomorrow.”
The acquisition positions Cadence to serve a broader customer base, including leading aerospace and automotive OEMs and Tier 1 suppliers such as Volkswagen Group, BMW, Toyota, Lockheed Martin, BAE Systems, and Boeing. These organizations rely on Hexagon’s D&E solutions for mission-critical simulation workflows, optimizing structural integrity, vehicle dynamics, and system reliability. As industries transition toward electric vehicles, autonomous systems, and advanced materials, the need for robust simulation tools becomes even more critical.
Strengthening Global Reach and Expertise
Hexagon’s D&E business generated approximately $280 million in revenue in 2024 and employs over 1,100 professionals across multiple global sites. Its world-class R&D, sales, and support teams bring deep domain expertise and strong ecosystem partnerships, further enhancing Cadence’s ability to deliver innovative solutions to customers worldwide. The integration of these teams will create a powerful synergy, combining Cadence’s computational software leadership with Hexagon’s proven simulation technologies.
The incoming business aligns seamlessly with Cadence’s growth strategy, enabling the company to address a wider range of design challenges while maintaining its reputation for excellence in engineering software. By leveraging Hexagon’s extensive portfolio, Cadence will offer customers a comprehensive suite of tools that span the entire design and analysis process, from concept to validation.
Enabling Innovation Across Industries
The acquisition comes at a pivotal time as industries undergo transformative changes. In the automotive sector, the shift toward electric vehicles and autonomous systems requires advanced simulation tools to optimize performance and safety. Similarly, the aerospace industry demands precise structural and dynamic analysis to ensure the reliability of complex systems. Robotics and physical AI represent emerging frontiers where accurate motion simulation is essential for developing intelligent machines capable of interacting with the physical world.
By integrating Hexagon’s D&E solutions into its portfolio, Cadence will empower customers to tackle these challenges head-on. The combined capabilities will enable seamless engineering workflows, reduce design iterations, and accelerate time-to-market for innovative products. This positions Cadence as a leader in the rapidly evolving field of multiphysics simulation and system design.
About Cadence
Cadence is a market leader in AI and digital twins, pioneering the application of computational software to accelerate innovation in the engineering design of silicon to systems. Our design solutions, based on Cadence’s Intelligent System Design strategy, are essential for the world’s leading semiconductor and systems companies to build their next-generation products from chips to full electromechanical systems that serve a wide range of markets, including hyperscale computing, mobile communications, automotive, aerospace, industrial, life sciences and robotics. In 2024, Cadence was recognized by the Wall Street Journal as one of the world’s top 100 best-managed companies. Cadence solutions offer limitless opportunities—learn more at www.cadence.com.
