Synopsys shares rally as activist Elliott builds multi-billion stake
shares summary As an activist investor, it climbed nearly 4% on Monday Elliott Investment Management CNBC’s David Faber confirmed that he acquired a multibillion-dollar stake in the company.
“As AI drives a step change in chip complexity and capital investment, Synopsys is uniquely positioned to benefit from this growth,” Elliott Managing Partner Jesse Cohn told CNBC.
“We believe there is a clear opportunity for Synopsys’ financial performance to more fully reflect the value it delivers,” Cohn said, highlighting Elliott’s plans to help the company “align operational execution, profitability and monetization with its potential and importance in the semiconductor ecosystem.” he added.
Elliott’s stake in Synopsys was first reported by: Wall StreetJournal.
Elliott declined to give the full value of its investment. The company bought $1 billion worth of shares on Pinterest earlier this month.
Synopsys’ services include electronic design automation and silicon design, which can help develop chips that will power artificial intelligence. The market value of the California-based company is approximately $80 billion.
In December, Nvidia bought $2 billion worth of Synopsys stock from a computing power partnership.
Nvidia CEO Jensen Huang called the investment a “huge deal” and said the partnership is intended to revolutionize design and engineering.
A surge in AI data center construction, fueled largely by Nvidia’s chips that require large amounts of memory, has contributed to the semiconductor shortage.
Synopsys CEO Sassine Ghazi told CNBC in January that he expects the memory chip “collapse” to continue through 2027.
