ON Semiconductor Corp. has agreed to acquire Synaptics Inc. in an all-stock transaction valued at approximately $7 billion, marking the largest deal in the company’s history.
The acquisition signals an aggressive expansion beyond ON Semiconductor’s core power and sensing business into the rapidly growing market for physical AI, intelligence that runs locally on hardware rather than remote servers.
Under terms of the agreement, which was unanimously approved by both boards, Synaptics shareholders will receive 1.350 shares of ON Semiconductor common stock for each share held. The exchange ratio represents roughly 19% premium based on the stocks’ 10-day volume-weighted average closing prices.
Wall Street reacted swiftly to the news in extended trading. Shares of ON Semiconductor fell between 6% and 10%, while Synaptics shares surged more than 10%.
ON Semiconductor expects the acquisition to expand its total addressable market by $30 billion, reaching $243 billion by 2030. Management projects the deal will be accretive to non-GAAP earnings per share within 18 months of closing and expect to realize $200 million in annual synergies. Upon completion, Synaptics shareholders will own approximately 12% of the combined company, and one Synaptics board member will join the ON Semiconductor board.
The transaction comes amid a broader consolidation wave in the tech industry as semiconductor and software giants race to secure AI capabilities. Recent deals include Qualcomm Inc.’s acquisition of infrastructure startup Modular and Salesforce Inc.’s $3.6 billion buyout of AI customer service platform Fin.
ON Semiconductor plans to integrate Synaptics’ Astra platform, which pairs AI and neural processing units with wireless connectivity like Wi-Fi and Bluetooth, into its automotive, industrial, and data center portfolios.
“As artificial intelligence moves beyond the cloud and into the physical world… the next phase of innovation will depend on systems that can sense, decide, act and adapt in real time,” ON Semiconductor CEO Hassane El-Khoury said in a statement. “The addition of Synaptics helps position ON Semi at the intersection of these four pillars.”
Synaptics CEO Rahul Patel noted the all-stock structure ensures shareholders will directly participate in the combined entity’s future growth, combining Synaptics’ Edge AI compute with ON Semiconductor’s leadership in intelligent power.
The transaction is expected to close in mid-2027, subject to regulatory approvals and the green light from Synaptics shareholders. Morgan Stanley and J.P. Morgan Securities advised ON Semiconductor on the deal, while Qatalyst Partners served as financial adviser to Synaptics.
