SpeedSim: Made to Exit Case Study Solution
Quickturn design systems were considered to be a successful business entity, which provided the vast solutions for reprogrammable emulation products used by the related customers of different industries. However, the segmentation of the business comprised of semi-conductor chips, programming solutions, workshops and other areas of product verification systems where the company was a pioneer of them.
Therefore, it shows that by 1996, the company investigated some merger and acquisition activities to acquire the businesses related to the operational activity of the business. Thus it concluded that acquiring the SpeedSim would benefit to increase the size of operations as well as continuously expanding the company’s reputation in the market in order to defeat the largest competitor (Synopsys).
So under the first round, it offered $20 million to acquire SpeedSim, which ended up with a non-serious considerations of the counter management and therefore under that case, the top management of SpeedSim seemed arrogant to the acquirer and not took serious response according to the criteria offered by Quickturn.
After one year, again the offered by proposed by Quickturn regarding the value of $52.5 million, that looked to be an overvalued price of the company according to the owner of Quickturn as well as the market analysts. But from the historical perspective, most of the software or IT companies had been acquired with high prices instead of the actual value. Thus it is identified that the offer was quite normal to the company as it was hungry top takeover the software house in order to defeat the biggest competitor of the market.
While the whole story illustrates the problems faced by both the companies regarding the difference in product expansion, research and development process as well as different nature of culture. Thus it is concluded that using the analytical tools and techniques, the researchers would be able to identify the lack of adoptable activities of Quickturn, also they would use a predetermined measure to analyze the probability of loss if the conditions would not be matched with both the companies regarding the lack of adoption of culture, the use of indifferent marketing techniques to offer the products and services as well as lack of relationships between two research and development systems.
So with all these problems, Quickturn would suffer a loss and would be subjected to sell in the future because it knew that the aim of SpeedSim was to took an opportunity to sell out when its market would be at the peak. So this activity would not be able to increase the operational size as well as new technological systems more than the expected one………………………….
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