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Acquisitions | 9 Months Ended
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Oct. 01, 2022
Business Combination and Asset Acquisition [Abstract] |
ACQUISITIONS | ACQUISITIONS Acquisition of OpenEye Scientific Software, Inc. On August 31, 2022, Cadence acquired all of the outstanding equity of OpenEye, a leading provider of computational molecular modeling and simulation software used by pharmaceutical and biotechnology companies for drug discovery. The addition of OpenEye’s technologies and experienced team with its deep scientific expertise is expected to accelerate Cadence’s Intelligent System Design™ strategy and broadens Cadence’s System Design and Analysis technology portfolio. The acquisition expands Cadence’s total addressable market, bringing Cadence’s computational software expertise to apply proven algorithmic, simulation and solver advances to life sciences. The aggregate cash consideration for Cadence’s acquisition of OpenEye, net of cash acquired of $13.2 million, was $461.1 million. Subject to service and other conditions, Cadence expects to recognize expense for consideration paid to certain former OpenEye shareholders, now employed by Cadence, through the first quarter of fiscal 2026. The total purchase consideration was allocated to the assets acquired and liabilities assumed based on their respective estimated fair values on the acquisition date as follows:
| Fair Value
| (In thousands)
Current assets | $ | 24,890 |
Goodwill | 368,148 |
Acquired intangibles | 117,400 |
Other long-term assets | 6,542 |
Total assets acquired | 516,980 |
Current liabilities | 15,489 |
Long-term liabilities | 27,225 |
Total liabilities assumed | 42,714 |
Total purchase consideration | $ | 474,266 |
The allocation of purchase consideration to certain assets and liabilities has not been finalized. Cadence will continue to evaluate certain estimates and assumptions, primarily related to taxes and assumed liabilities, during the measurement period (up to one year from the acquisition date). The recorded goodwill is attributed to intangible assets that do not qualify for separate recognition, including the acquired assembled workforce, and will not be deductible for tax purposes. Acquired Intangibles
| Fair Value |  | Weighted-Average Amortization Period
| (In thousands) |  | (in years)
Existing technology | $ | 53,900 |  |  | 7.0 years
Agreements and relationships | 61,400 |  |  | 12.3 years
Tradenames, trademarks and patents | 2,100 |  |  | 7.0 years
Total acquired intangibles with definite lives | $ | 117,400 |  |  | 9.8 years
Acquisition of FFG Holdings Limited On July 14, 2022, Cadence acquired all of the outstanding equity of FFG Holdings Limited (“Future Facilities”), a provider of electronics cooling analysis and energy performance optimization solutions for data center design and operations using physics-based 3D digital twins. The addition of Future Facilities’ technologies and expertise supports Cadence’s Intelligent System Design strategy and broadens its System Design and Analysis technology portfolio with the addition of solutions that enable companies to make informed business decisions about data center design, operations and lifecycle management that reduce their carbon footprint. The aggregate cash consideration for Cadence’s acquisition of Future Facilities, net of cash acquired of $2.8 million, was $100.1 million. Subject to service and other conditions, Cadence expects to recognize expense for consideration paid to certain former Future Facilities shareholders, now employed by Cadence, subject to service and other conditions, through the third quarter of fiscal 2025. The total purchase consideration was allocated to the assets acquired and liabilities assumed based on their respective estimated fair values on the acquisition date as follows:
| Fair Value
| (In thousands)
Current assets | $ | 7,992 |
Goodwill | 67,868 |
Acquired intangibles | 38,100 |
Other long-term assets | 3,102 |
Total assets acquired | 117,062 |
Current liabilities | 4,952 |
Long-term liabilities | 9,210 |
Total liabilities assumed | 14,162 |
Total purchase consideration | $ | 102,900 |
The allocation of purchase consideration to certain assets and liabilities has not been finalized. Cadence will continue to evaluate certain estimates and assumptions, primarily related to taxes and assumed liabilities, during the measurement period (up to one year from the acquisition date). The recorded goodwill is attributed to intangible assets that do not qualify for separate recognition, including the acquired assembled workforce and expected synergies from combining operations of Future Facilities with Cadence. The goodwill will not be deductible for tax purposes. Acquired Intangibles
| Fair Value |  | Weighted-Average Amortization Period
| (In thousands) |  | (in years)
Existing technology | $ | 20,900 |  |  | 6.0 years
Agreements and relationships | 15,600 |  |  | 9.0 years
Tradenames, trademarks and patents | 1,600 |  |  | 8.0 years
Total acquired intangibles with definite lives | $ | 38,100 |  |  | 7.3 years
Other Acquisitions During the second quarter of fiscal 2022, Cadence completed one business combination for aggregate cash consideration of $25.0 million. The total purchase consideration was allocated to assets acquired based on their respective estimated fair values on the acquisition date. Cadence recorded $15.0 million of acquired intangible assets, which consisted of $8.2 million of existing technology and $6.8 million of in-process technology. Cadence also recognized $10.0 million of goodwill, which is primarily attributed to an assembled workforce. The goodwill recognized is expected to be deductible for tax purposes. Pro Forma Financial Information Cadence has not presented pro forma financial information for acquisitions completed during the first three quarters of fiscal 2022 because the results of operations from the acquired businesses are not material to Cadence’s condensed consolidated financial statements. Transaction Costs Transaction costs associated with acquisitions are included in general and administrative expense in Cadence’s condensed consolidated income statement. During the three and nine months ended October 1, 2022, transaction costs associated with acquisitions were $3.6 million and $10.1 million, respectively. During the three and nine months ended October 2, 2021, transaction costs associated with acquisitions were $0.1 million and $2.0 million, respectively.

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- Definition The entire disclosure for a business combination (or series of individually immaterial business combinations) completed during the period, including background, timing, and recognized assets and liabilities. The disclosure may include leverage buyout transactions (as applicable). + References Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 805 -URI https://asc.fasb.org/topic&trid=2303972 Reference 2: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 805 -SubTopic 20 -Section 50 -Paragraph 5 -Subparagraph (b) -URI https://asc.fasb.org/extlink&oid=128092470&loc=d3e4946-128472 + Details
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