On Semiconductor has agreed to acquire Synaptics in a nearly $7 billion all-stock transaction, the companies announced Thursday. The deal is expected to close by the middle of 2027. Onsemi shares dropped more than 9% in after-hours trading, while Synaptics jumped over 11%.
The acquisition bolsters Onsemi's push into physical artificial intelligence technology, combining its power and sensor chips with Synaptics' human-interface expertise. The move positions the combined firm to compete more aggressively in the rapidly evolving AI hardware market.
Under the terms, Synaptics shareholders will receive a fixed number of Onsemi shares for each Synaptics share held. The exact exchange ratio was not disclosed, but the transaction values Synaptics at roughly $7 billion based on Onsemi's closing price before the announcement.
The all-stock structure avoids immediate cash outlay for Onsemi, which has been investing heavily in AI-related chip technologies. Closing in mid-2027 gives both companies time to navigate regulatory approvals and integrate operations.
Some analysts question whether the premium justifies the long timeline, noting that Synaptics' core PC touchpad market faces secular decline. The deal's success hinges on execution of Onsemi's physical AI strategy.