ON Semiconductor’s $7B Synaptics all-stock deal

ON Semiconductor has agreed to buy Synaptics in an all-stock transaction that values Synaptics at roughly $7.0 billion in enterprise value. The agreement, announced in late June 2026, marks ON Semiconductor’s largest acquisition and is intended to strengthen its position in edge artificial intelligence and wireless connectivity.

Under the terms of the deal, Synaptics shareholders will receive 1.350 shares of ON Semiconductor common stock for each Synaptics share they hold. The companies described this exchange ratio as representing about a 19% premium to recent trading prices for Synaptics, and Synaptics shareholders are expected to own about 12% of the combined company on a fully diluted basis after closing.

ON Semiconductor said the acquisition is aimed at capitalizing on the growth of physical artificial intelligence, in which devices can sense their environment and make decisions in real time. By adding Synaptics’ edge AI and wireless connectivity capabilities, ON Semiconductor plans to build out AI-centric compute platforms that can support applications such as robotics and autonomous vehicles.

The company stated that Synaptics’ portfolio will provide immediate connected compute capabilities and expand ON’s software and ecosystem reach. ON Semiconductor expects the combination to increase its total addressable market by approximately $30 billion, bringing it to about $243 billion by 2030 as demand for intelligent, connected systems grows.

ON Semiconductor forecasts approximately $200 million in annual cost savings from integrating Synaptics’ operations. The company also expects the transaction to be accretive to non-GAAP earnings per share within 18 months after the deal closes, reflecting both cost synergies and revenue opportunities from the broader portfolio.

As part of the governance arrangements, both boards unanimously approved the transaction, and one Synaptics board member is expected to join ON Semiconductor’s board after completion. The companies have also engaged a series of financial and legal advisers to support the process, including Morgan Stanley (MS) and J.P. Morgan for ON Semiconductor and Qatalyst Partners for Synaptics, with legal counsel from Skadden, Arps and Baker McKenzie respectively.

The companies expect the deal to close in mid-2027, subject to approval by Synaptics stockholders, required regulatory clearances, and other customary closing conditions. Until closing, the two businesses will continue to operate independently.

Initial investor response to the announcement was mixed. Reports indicated that ON Semiconductor shares fell by roughly 8% to 10% in extended trading following the news, while Synaptics shares rose by about 10% to 12%. The reaction reflects contrasting views between the acquirer’s shareholders, who must absorb deal and integration risks, and Synaptics investors, who benefit from the premium and participation in the combined entity.