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onsemi and Synaptics Incorporated announced they have entered into a definitive agreement under which onsemi has agreed to acquire Synaptics in an all-stock transaction, representing a total enterprise value of approximately $7 billion. The transaction value reflects a fixed exchange ratio of 1.350 shares of onsemi common stock for each Synaptics share and represents an approximately 19% premium to the volume weighted average closing prices of onsemi and Synaptics over the last 10 trading days.
The combination would accelerate onsemi’s evolution toward global leadership in intelligent systems. By adding Synaptics’ differentiated Edge AI compute franchise and strong portfolio of human-machine interface and wireless connectivity solutions, onsemi is expected to extend its capabilities beyond power and sensing to intelligent systems, delivering greater value to a broad range of end markets. Building on onsemi’s expertise in automotive, industrial and AI data center, the combined platform is intended to position onsemi at the center of Physical AI, with the potential to expand onsemi’s TAM by $30 billion to $243 billion by 2030.
“As artificial intelligence moves beyond the cloud and into the physical world, including automotive and industrial, the next phase of innovation will depend on systems that can sense, decide, act and adapt in real time,” said Hassane El-Khoury, President and CEO of onsemi. “This shift towards Physical AI will require Power, Sense, Connected Compute and Control to work together seamlessly. The addition of Synaptics helps position onsemi at the intersection of these four pillars, enabling us to capture a significantly larger AI opportunity that extends beyond AI data center and into edge applications. This transaction would add immediate connected compute capabilities, expand our software and ecosystem reach and position onsemi to deliver greater value as customers increasingly seek intelligent systems.”
“Today’s announcement marks an important step in accelerating Synaptics’ growth and leadership in Edge AI and Physical AI,” said Rahul Patel, Synaptics President and CEO. “Together with onsemi, we will combine Synaptics’ strengths in AI-native compute, connectivity, and human-machine interface with onsemi’s leadership in intelligent power and sensing to offer customers integrated solutions and development platforms across every layer of the Edge AI stack, deepening customer engagement and expanding across a greater total addressable market. The all-stock structure allows our shareholders to participate in the compelling growth and value creation opportunities ahead, and I look forward to working with the onsemi leadership team to help realize the full value of this combination.”
Compelling Strategic and Financial Rationale
The combination is expected to deliver substantial value:
- Enables capabilities from AI Infrastructure to Physical AI: onsemi is already well-positioned across the AI infrastructure ecosystem, from the energy grid to the data center core. This transaction is expected to extend that reach to the intelligent edge, enabling onsemi to address additional end markets while enhancing its capabilities to become a provider of integrated, system-level solutions across Power, Sense, Connected Compute and Control. This compelling combination would enable systems that can sense, decide, act and adapt in real time across Physical AI applications, including autonomous driving, robotics, and AR/VR.
- Adds a proven, scalable Edge AI connected compute platform to onsemi: Synaptics’ Astra platform combines purpose-built AI processors and NPUs for multimodal intelligence with an industry-leading wireless connectivity portfolio spanning Wi-Fi, Bluetooth and GPS and a full open-source software stack for rapid deployment.
- Complementary portfolios designed to unlock significant revenue growth with scale: The combination of two highly complementary portfolios would allow onsemi to accelerate its innovation and product roadmap to capture higher dollar content per platform while fostering deeper long-term customer engagement. This is anticipated to increase onsemi’s exposure to higher-value, differentiated system solutions with embedded IP and software, supporting improved mix, margin expansion and durable growth.
- Attractive financial profile: The transaction is expected to be accretive to non-GAAP EPS within 18 months of closing, with an expected $200 million in annual synergies and gross margins consistent with onsemi’s long-term financial model. onsemi remains committed to maintaining its existing capital return policy during the pendency period.
Transaction Details
Under the terms of the agreement, which has been unanimously approved by the Boards of Directors of both companies, Synaptics stockholders will receive 1.350 shares of onsemi common stock for each share of Synaptics common stock held at the time of closing, implying pro forma ownership of approximately 12% for Synaptics stockholders on a fully diluted basis.
As part of the transaction, one member of the Synaptics Board of Directors is expected to join onsemi’s Board of Directors.
The transaction is expected to close in mid-2027, subject to approval by Synaptics stockholders, the receipt of required regulatory approvals and other customary conditions.
