Hexagon AB has agreed to sell its Design & Engineering software business to Cadence Design Systems Inc. for approximately 2.7 billion euros, reversing a major acquisition made eight years ago.
The sale includes MSC Software, a simulation software provider Hexagon acquired in 2017 for $834 million.
The Swedish industrial technology company said the divestment is part of a strategy to streamline its portfolio and focus on its core business of real-world data capture and measurement.
"Today’s announcement is a step in our plan to streamline Hexagon’s portfolio and focus on the capture, measurement, and use of real-world data, while also strengthening our financial flexibility," said Ola Rollén, Chairman of the Board for Hexagon.
Rollén added that the engineering simulation market is evolving with electronic design automation suppliers taking a leading role, a trend that is "harder for Hexagon to follow."
The Design & Engineering unit contributed about 265 million euros in revenue in 2024, according to the company.
The deal, expected to close in the first quarter of 2026, consists of cash and a 30% portion in Cadence common stock.
The move comes as Hexagon faces financial pressure, having recently reported a drop in its quarterly adjusted operating margin and announced the departure of its chief financial officer.
Hexagon said proceeds will be used for general corporate purposes, which may include debt reduction and funding future acquisitions.
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