Virage buys Mentor library unit

Virage buys Mentor library unit
SAN JOSE, Calif. — Building its strength in the embedded memory market, Virage Logic has purchased Mentor Graphics' Physical Library Division (PLD) for an undisclosed sum. The move closely follows Artisan Components' decision to back out of its earlier agreement to purchase the division, and puts to rest a lawsuit that Mentor filed last summer against Virage.

The New Jersey-based PLD, which originally had around 35 employees, has been passed around like a hot potato in recent months. In August, Mentor and Artisan announced that Artisan would buy the unit. But Virage, which had also been negotiating to buy the PLD, hired five of its key managers, triggering a lawsuit by Mentor alleging breach of contract and misappropriation of trade secrets.

The Artisan deal fell through several weeks ago when Mentor and Artisan were unable to agree to terms. Mentor and Virage then put out feelers to see if talks could be resumed, and Virage closed the deal in 10 day's time, said Adam Kablanian, president and CEO of Virage.

"We decided it was a win-win for Mentor and Virage to get back to the table, and also a win for our customers, instead of spending money on lawyers," said Kablanian. "We did hire the five managers, but the body was separate from the head. Now we've connected the body back to the head and made it a very strong technical team."

Mentor decided it was going to divest its library business some time ago, and was primarily interested in finding a purchaser who could offer good customer support, said Mick O'Brien, general manager of Mentor's intellectual property (IP) division. "We've very happy our customers are going to get that support," he said.

Mentor's PLD is strong in memory, which is Virage's forte. The unit's Memory Builder product is a tool for building memory cores. The PLD also developed 0.25 and 0.18 micron libraries of standard cells and I/Os.

"This move will strengthen our memory position with Memory Builder and memory compilers," said Kablanian. "We also have commitment to support all existing Mentor customers in standard cells and I/Os. Sometime down the line, we'll decided whether to invest or divest in that business."

While there's some overlap between the Mentor and Virage memory libraries, Kablanian noted that Mentor has some support Virage did not have, most notably 0.25 and 0.18 micron libraries for UMC.

Kablanian said that most employees of Mentor PLD have been rehired by Virage, and that there's now a group of 25 people at the New Jersey office of the former Mentor PLD.

O'Brien said that Mentor was able to retain employees while the negotiations were underway with Artisan, and later Virage. "We didn't lose customers either, because we kept the focus on customer support and deliverables," he said.

Learning from the Artisan experience, Mentor also didn't announce the PLD's sale until after negotiations were completed. "We're very pleased to say this deal is closed," said O'Brien.