Onsemi to buy Synaptics in $7 billion stock deal

Onsemi has entered into a definitive agreement to acquire Synaptics in an all-stock transaction that assigns the combined company an enterprise value of approximately $7.0 billion, including debt. The agreement sets a fixed exchange ratio under which each Synaptics share will be converted into 1.350 shares of Onsemi common stock.

Based on the 10-day volume-weighted average closing prices of both stocks prior to the announcement, the exchange ratio represents a premium of roughly 19% for Synaptics shareholders. The structure makes Synaptics investors direct shareholders of the enlarged Onsemi once the transaction is completed.

The transaction values Synaptics at about $6.2 billion in equity terms, with the total enterprise value rising to roughly $7.0 billion when including debt. Upon closing, Synaptics stockholders are expected to own approximately 12% of the combined company on a fully diluted basis, reflecting their share of the enlarged equity base.

Governance arrangements include the expectation that one member of the Synaptics board will join Onsemi’s board after the deal closes. The boards of directors of both companies have unanimously approved the agreement, indicating corporate-level support for the combination.

The companies expect the acquisition to close in mid-2027, subject to approval by Synaptics stockholders, required regulatory clearances and other customary closing conditions. Until those requirements are satisfied and the transaction is completed, the two firms will continue to operate as separate entities.

Onsemi and Synaptics have outlined a target of about $200 million in annual synergies once the integration is underway. They also project that the transaction will be accretive to non-GAAP earnings per share within 18 months of closing, suggesting a planned financial benefit after integration costs and restructuring efforts.

Initial market response to the announcement was negative for Onsemi’s stock. In extended trading following the release of the deal, Onsemi shares fell by about 7.4%, indicating immediate investor concerns or uncertainty about the acquisition’s near-term implications.

The premium offered to Synaptics shareholders, combined with the all-stock structure, shifts part of the transaction risk and future performance to the combined shareholder base. How investors assess the promised synergies and earnings accretion over time will likely influence future trading in both companies’ shares as the deal progresses toward the anticipated 2027 closing.