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A simulated-annealing based algorithm to partition an application specific system into a set of modules is presented. The role of partitioning is to discover the structure implicit in the functional specification of the system so as to guide high level synthesis decisions in a design environment for digital systems consisting of hardware parts and possibly software components. The partitioning algorithm can also be used to partition the final or intermediate results of a high-level synthesis process into several physical blocks. Experimental results show that the approach produces better register-transfer designs with less global communications.< >