Beijing delays approval of $35bn Synopsys-Ansys semiconductor deal amid chip export tensions

Beijing delays approval of $35bn Synopsys-Ansys semiconductor deal amid chip export tensions (File image)

A $35bn merger between US chip design giant Synopsys and engineering software company Ansys is facing delays in Beijing, as China’s antitrust regulator postpones its approval amid rising tensions over Washington’s latest chip export restrictions, the Financial Times reported.

The State Administration for Market Regulation (SAMR) has held up the deal, which had entered the final stage of China’s regulatory process and was expected to close by the end of June, according to two people familiar with the situation.

The delay comes just weeks after President Donald Trump’s administration moved in late May to ban US companies — including Synopsys — from selling advanced chip design software to China, further complicating the regulatory landscape.

Complex approval process

While the transaction has already been approved by authorities in the US and Europe, SAMR’s review has become more complicated following Washington’s decision, a person with knowledge of the matter said. However, this person added that approval is still possible if Synopsys can address Chinese regulators’ concerns.

Another source said that SAMR’s extended review — beyond the initial 180-day timetable — is largely due to the technical complexity of the deal itself rather than being a direct retaliatory measure linked to the trade war.

On May 28, Synopsys CEO Sassine Ghazi told investors the company was “working cooperatively and actively negotiating with SAMR to secure China regulatory clearance” and remained hopeful of closing the deal in the first half of this year. The agreement includes a January 15, 2026, “drop dead clause,” allowing the parties to walk away if approval is not granted by then.

Synopsys declined to comment, while Ansys did not respond to a request for comment. SAMR did not answer calls outside regular working hours.

Context of fragile US-China talks

The deal delay comes as Trump seeks to stabilise US-China trade relations after months of escalating tensions. The two sides this week reached an agreement in London to reinstate the trade war truce brokered in Geneva in May, which included substantial mutual tariff reductions.

A senior White House official indicated this week that the Trump administration could ease some technology export controls if Beijing agreed to accelerate rare earth shipments — vital for the US tech and defence industries.

There have already been tentative signs of flexibility. Synopsys, which had initially halted all sales to Chinese clients, has recently resumed selling certain intellectual property and hardware, though electronic design automation (EDA) software tools remain restricted, according to a person with direct knowledge.

Strategic importance of the deal

Synopsys’s design tools and intellectual property are critical to the global semiconductor industry, used by chipmakers including Nvidia and Intel to create and test advanced processors. The Silicon Valley firm has grown rapidly in recent years as Big Tech players such as Microsoft, Google, Meta, and Amazon increasingly develop custom chips to power artificial intelligence services.

Ansys, based in Pennsylvania, specialises in engineering simulation software used across sectors from automotive and construction to healthcare and defence.

The Trump administration’s evolving stance on technology exports — and China’s careful scrutiny of this high-profile US merger — underscores how critical the semiconductor sector has become in the broader US-China strategic rivalry.