Mentor Graphics acquires Valor

Taking a page from the PLM playbook, Mentor Graphics announced on March 18 that it had acquired Valor Computerized Systems, extending its reach from design into manufacturability. The net price paid was about $50 million. Valor did not report revenue for the fourth quarter of 2009; revenue through the first nine months was down about 15% from the prior year. Assuming this held through Q4, Mentor paid a revenue multiple of about 1.5.

Mentor produces design solutions for printed circuit boards (PCBs); Valor’s products ready PCB designs for manufacturing including fabrication of the bare PCB and assembly of PCB components. As Mentor’s press release so succinctly puts it, “[w]ith the acquisition of Valor, Mentor is now positioned as the only EDA supplier to provide the electronics industry with a PCB systems solution from concept through manufacturing.” According to the FAQ covering the acquisition, Mentor will continue to support and enhance the “full range” of Valor products and create “additional capabilities in both design and manufacturing”.

Valor becomes a division of Mentor Graphics, with Valor CEO Dan Hoz as general manager. Mentor sees its commitment to the PCB manufacturing market as key to its future success and intends to integrate design for manufacturing functionality into Mentor and non-Mentor PCB design environments alike. Valor will maintain a separate sales force to serve the manufacturing industry.

Since this deal was actually announced quite a while ago Wall Street says “eh”, with Mentor shares essentially flat for the day.