shares of synopsis CNBC’s David Faber confirmed that the stock rose about 4% on Monday after activist investor Elliott Investment Management 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,” Jesse Cohn, managing partner at Elliott, told CNBC.
“We believe there is a clear opportunity for Synopsys’ financial performance to more fully reflect the value the company provides,” Kohn added, highlighting Elliott’s plans to help the company “align its execution, profitability and monetization with its potential and importance in the semiconductor ecosystem.”
Elliott’s investment in Synopsys was first reported by the Wall Street Journal.
Elliott declined to reveal the exact value of the investment. The company acquired $1 billion in stock. pinterest Early this month.
Synopsys’ services include electronic design automation and silicon design to help develop chips that power artificial intelligence. The California-based company has a market capitalization of approximately $80 billion.
In December, Nvidia Computing Power Partnership purchased $2 billion of Synopsys common stock.
Nvidia CEO Jensen Huang called the investment a “huge deal” and said the partnership will revolutionize design and engineering.
The surge in construction of AI data centers, mostly based on Nvidia chips that require large amounts of memory, is contributing to the semiconductor shortage.
Synopsys CEO Sashin Ghazi told CNBC in January that he expected the “demand deficit” for memory chips to continue until 2027.
