MIPS Technologies Inc., which in August 2007 bought Chipidea, a Portuguese analog and mixed-signal IP company, announced Friday (May 8) that it has now divested its analog business group to Synopsys Inc. in an all-cash transaction for $22 million, effective immediately.

The marriage lasted only 18 months.

John Bourgoin, MIPS Technologies president and CEO, still stands by his original wisdom. Acquiring the analog IP vendor was a "strategic move." During a conference call, he said that the acquisition was intended to "expand our offerings to our customers more parts of SoCs that are difficult to do."

OK, so what went wrong?

Bourgoin blamed the economy. "After two good quarters, the analog market has gone into a sharp downturn, while macro-economic continued to slow down, which affected our entire business."

While insisting on the "growth potential" for analog IPs, Bourgoin explained that the continued economic downturn and MIPS' balance sheet with "a limited ability to absorb the shock" forced him to choose the path of divesting MIPS' analog business unit.

Does this signal to the market that IP business of this nature is now more suited to EDA companies? After all, IPs can be simply dropped into their design flow.

Certainly, the acquisition of MIPS' analog business group will help expand Synopsys' $100 million DesignWare intellectual property portfolio, with a new family of analog IP such as analog-to-digital converters, digital-to-analog converters, audio codecs and power management IP.

Moreover, the acquisition places Synopsys, already the leading EDA vendor, in a strong No. 2 position as an IP provider behind ARM and ahead of MIPS.

"With this acquisition, Synopsys is well-positioned to provide our customers with a strong interface and analog IP portfolio that is silicon-proven, shipping in volume and unmatched in the industry," said Joachim Kunkel, vice president and general manager of the solutions group at Synopsys.

"We are especially excited with the addition of HDMI TX and RX protocols to Synopsys' existing interface IP solution," added John Koeter, vice president of marketing of Synopsys' solutions group.

"This adds some 260 engineers of analog and digital expertise to our group of 250 IP experts we have in our group," said Koeter. The company claims that it has accumulated its own analog IP expertise over the last four to five years through strategic acquisitions, such as inSilicon and Accelerent Networks.

The acquisition also provides validation for the company's latest Lynux design flow to qualify and test both digital and analog IP, said Koeter.