onsemi Proposes to Acquire Allegro MicroSystems for $35.10 Per Share in Cash
onsemi (NASDAQ: ON) has proposed to acquire Allegro MicroSystems (NASDAQ: ALGM) for $35.10 per share in an all-cash transaction, valuing the company at an enterprise value of $6.9 billion. The offer represents a 57% premium to Allegro's unaffected closing share price on February 28, 2025.
The proposal follows multiple attempts by onsemi to engage with Allegro over six months, including an initial offer of $34.50 per share in September 2024. The combination would unite two complementary businesses in automotive and industrial markets, particularly in magnetic sensing and power ICs.
onsemi plans to finance the transaction through a combination of committed financing, cash on hand, and existing credit facilities. The company aims to create a diversified leader in automotive, industrial, and AI data center applications through this strategic acquisition.
onsemi (NASDAQ: ON) ha proposto di acquisire Allegro MicroSystems (NASDAQ: ALGM) per $35.10 per azione in una transazione interamente in contante, valutando l'azienda a un valore d'impresa di 6,9 miliardi di dollari. L'offerta rappresenta un premio del 57% rispetto al prezzo di chiusura non influenzato delle azioni di Allegro del 28 febbraio 2025.
La proposta segue diversi tentativi da parte di onsemi di entrare in contatto con Allegro nel corso di sei mesi, inclusa un'offerta iniziale di $34.50 per azione nel settembre 2024. La combinazione unirebbe due aziende complementari nei mercati automobilistico e industriale, in particolare nella sensoristica magnetica e nei circuiti integrati di potenza.
onsemi prevede di finanziare la transazione attraverso una combinazione di finanziamenti impegnati, liquidità disponibile e linee di credito esistenti. L'azienda mira a creare un leader diversificato nelle applicazioni automobilistiche, industriali e nei data center AI attraverso questa acquisizione strategica.
onsemi (NASDAQ: ON) ha propuesto adquirir Allegro MicroSystems (NASDAQ: ALGM) por $35.10 por acción en una transacción completamente en efectivo, valorando la compañía en un valor empresarial de 6.9 mil millones de dólares. La oferta representa una prima del 57% sobre el precio de cierre no afectado de las acciones de Allegro del 28 de febrero de 2025.
La propuesta sigue a múltiples intentos de onsemi por involucrarse con Allegro durante seis meses, incluyendo una oferta inicial de $34.50 por acción en septiembre de 2024. La combinación uniría dos negocios complementarios en los mercados automotriz e industrial, particularmente en sensores magnéticos y circuitos integrados de potencia.
onsemi planea financiar la transacción a través de una combinación de financiamiento comprometido, efectivo disponible y líneas de crédito existentes. La compañía tiene como objetivo crear un líder diversificado en aplicaciones automotrices, industriales y de centros de datos de IA a través de esta adquisición estratégica.
onsemi (NASDAQ: ON)은 Allegro MicroSystems (NASDAQ: ALGM)을 주당 $35.10에 인수하겠다고 제안했습니다. 이는 전액 현금 거래로, 회사의 기업 가치는 69억 달러에 해당합니다. 이 제안은 2025년 2월 28일 Allegro의 영향을 받지 않은 종가에 비해 57%의 프리미엄을 나타냅니다.
이 제안은 onsemi가 Allegro와의 접촉을 시도한 지 6개월 만에 이루어진 것으로, 2024년 9월에는 주당 $34.50의 초기 제안이 있었습니다. 이 조합은 자동차 및 산업 시장에서 상호 보완적인 두 회사를 통합할 것입니다. 특히 자력 센서 및 전력 IC 분야에서 그렇습니다.
onsemi는 약속된 금융, 보유 현금 및 기존 신용 시설의 조합을 통해 거래를 금융할 계획입니다. 이 회사는 이번 전략적 인수를 통해 자동차, 산업 및 AI 데이터 센터 애플리케이션에서 다각화된 리더를 만드는 것을 목표로 하고 있습니다.
onsemi (NASDAQ: ON) a proposé d'acquérir Allegro MicroSystems (NASDAQ: ALGM) pour 35,10 $ par action dans le cadre d'une transaction entièrement en espèces, évaluant l'entreprise à une valeur d'entreprise de 6,9 milliards de dollars. L'offre représente une prime de 57 % par rapport au prix de clôture non affecté des actions d'Allegro au 28 février 2025.
La proposition fait suite à plusieurs tentatives d'onsemi de dialoguer avec Allegro pendant six mois, y compris une offre initiale de 34,50 $ par action en septembre 2024. La combinaison unirait deux entreprises complémentaires sur les marchés automobile et industriel, en particulier dans la détection magnétique et les circuits intégrés de puissance.
onsemi prévoit de financer la transaction par une combinaison de financements engagés, de liquidités disponibles et de lignes de crédit existantes. L'entreprise vise à créer un leader diversifié dans les applications automobiles, industrielles et de centres de données IA grâce à cette acquisition stratégique.
onsemi (NASDAQ: ON) hat vorgeschlagen, Allegro MicroSystems (NASDAQ: ALGM) für 35,10 $ pro Aktie in einer rein bargeldbasierten Transaktion zu erwerben, was das Unternehmen mit einem Unternehmenswert von 6,9 Milliarden Dollar bewertet. Das Angebot stellt eine Prämie von 57 % gegenüber dem nicht beeinträchtigten Schlusskurs von Allegro am 28. Februar 2025 dar.
Der Vorschlag folgt mehreren Versuchen von onsemi, über einen Zeitraum von sechs Monaten mit Allegro in Kontakt zu treten, einschließlich eines anfänglichen Angebots von 34,50 $ pro Aktie im September 2024. Die Kombination würde zwei komplementäre Unternehmen in den Automobil- und Industriesektoren vereinen, insbesondere im Bereich der magnetischen Sensorik und Leistungsschaltungen.
onsemi plant, die Transaktion durch eine Kombination aus zugesagter Finanzierung, verfügbaren Barmitteln und bestehenden Kreditlinien zu finanzieren. Das Unternehmen strebt an, durch diese strategische Akquisition einen diversifizierten Marktführer in den Bereichen Automobil, Industrie und KI-Datenzentren zu schaffen.
- 57% premium offered to shareholders
- Complementary product portfolio synergies
- No financing contingencies
- Clear strategic fit in automotive and industrial markets
- No agreement reached despite 6 months of attempts
- Potential regulatory approval risks
- Integration challenges and costs
- Possible dilution risks for onsemi
Insights
This unsolicited acquisition proposal from onsemi to purchase Allegro MicroSystems at
onsemi's public disclosure of their repeated private attempts to engage Allegro since September 2024 signals frustration with target management's reluctance and represents a tactical shift to pressure Allegro's board through shareholder awareness. This approach typically aims to force serious negotiations or potentially set the stage for a hostile takeover attempt.
The acquisition financing structure appears solid, with onsemi planning to utilize a combination of committed financing, existing cash reserves, and their revolving credit facility without contingencies. This suggests strong balance sheet capacity and financial confidence in executing the transaction.
From a strategic perspective, the complementary product portfolios create clear technical synergies - onsemi would strengthen its position in magnetic sensing (where Allegro leads) while expanding its automotive and industrial market presence. The premium offered reflects both the strategic value and the current market conditions where semiconductor acquisitions command higher multiples due to increased demand in automotive electrification and AI infrastructure markets.
However, semiconductor industry consolidation faces heightened regulatory scrutiny globally, potentially extending approval timelines or requiring structural remedies that could impact deal economics. The proposed transaction represents a significant strategic repositioning in the power semiconductor landscape.
This proposed acquisition represents a significant consolidation move in the specialized semiconductor market for automotive and industrial applications. onsemi's pursuit of Allegro makes technical sense - Allegro's leadership in magnetic sensing technologies would substantially enhance onsemi's intelligent power solutions portfolio, creating a more comprehensive offering for automotive and industrial customers.
The timing is particularly strategic as the automotive semiconductor market undergoes transformation driven by electrification trends. Allegro's sensing technologies are critical components in electric vehicle powertrain systems, battery management, and advanced driver assistance features - all high-growth segments where onsemi seeks greater market penetration.
Beyond automotive, the combined entity would establish a stronger competitive position in the rapidly expanding AI data center market, where power efficiency and thermal management are becoming important differentiators. Allegro's power IC capabilities would complement onsemi's existing data center offerings at a time when AI infrastructure buildout is accelerating globally.
The technical integration appears logical as both companies focus on similar end markets with complementary rather than overlapping technologies. Customer overlap would likely create cross-selling opportunities while simplifying supply chain relationships for automotive and industrial OEMs seeking integrated solutions.
onsemi's public disclosure strategy after six months of private approaches indicates determination to complete this acquisition. The semiconductor industry continues consolidating as companies seek scale advantages and broader technology portfolios to address increasingly complex customer requirements in autonomous vehicles, industrial automation, and AI computing - all markets where this combined entity would have strengthened positioning.
All-Cash Proposal Represents Attractive and Immediate Premium of
onsemi has made numerous attempts over the past six months to enter into constructive discussions regarding a potential transaction. The most recent Proposal was submitted to Allegro on February 12, 2025, and represents an increase over an initial
“We believe the combination of onsemi and Allegro would bring two highly complementary businesses together, benefitting our respective customers and delivering immediate value to Allegro shareholders,” said Hassane El-Khoury, President and Chief Executive Officer of onsemi. “The Allegro team has built an impressive leadership position in magnetic sensing and power ICs for the automotive and industrial end-markets. Together, Allegro’s unique product portfolio and onsemi’s differentiated intelligent power and sensing technologies would create a diversified leader in automotive, industrial and AI data center applications.”
El-Khoury continued, “While we would have preferred to reach an agreement with Allegro privately, the decision to make our proposal public reflects our conviction in the merits of a combined company, which we believe is in the best interests of Allegro and onsemi shareholders. We urge the Allegro Board and management team to engage in good faith discussions with onsemi’s management team regarding the proposed transaction, which maximizes value for Allegro shareholders.”
The combination between onsemi and Allegro would create a natural strategic fit given both parties’ respective strengths within the automotive and industrial markets:
- Compelling Strategic Rationale That Delivers Benefits for Customers and Employees: Allegro’s product offering complements onsemi’s leadership in intelligent power and sensing for automotive, industrial and AI data center applications. A combination would bring together two strong teams with a shared culture of innovation and access to exciting new development opportunities within an expanded organization.
-
Delivering Immediate and Certain Value for Allegro Shareholders: Under the terms of the Proposal, onsemi’s all-cash
$35.10 57% premium to Allegro’s closing share price on February 28, 2025, the last trading day prior to media reports regarding onsemi’s interest in acquiring Allegro.
- Clear Path to Completion and Plan for Financing: onsemi has assembled a team of highly experienced advisors and is prepared to move swiftly and efficiently to complete due diligence and negotiate a mutually agreeable definitive agreement. The company does not anticipate any financing contingencies and intends to fund the potential transaction with a combination of committed financing, cash on hand, and funds available under its existing revolving credit facility.
Engagement History
onsemi first approached Allegro regarding a potential all-cash acquisition on September 2, 2024, via a formal letter with an initial all-cash
onsemi's request since September 2, 2024, has been consistent: to advance the possibility of this valuable outcome for shareholders through rigorous management-to-management dialogue and pursuing the requisite diligence and scoping of regulatory requirements in order to expeditiously move towards finalization of a transaction.
Forward-Looking Statements
This document contains statements that constitute “forward-looking statements” within the meaning of the federal securities laws. All statements other than statements of historical fact are forward-looking statements, including, without limitation, statements regarding onsemi’s current expectations, estimates, and projections about its industry, its business, or the proposed transaction with Allegro MicroSystems, Inc. (“Allegro”). We caution investors that any forward-looking statements are subject to risks and uncertainties that may cause actual results and future trends to differ materially from those matters expressed in, or implied by, such forward-looking statements. Investors are cautioned not to place undue reliance on forward-looking statements.
Among the risks and uncertainties that could cause actual results or events to differ materially from those indicated by such forward-looking statements are the following: (1) the risk that the proposed transaction may not be consummated or may not be consummated in the expected timeframe, including the possibility that the parties may not reach a definitive agreement or satisfy closing conditions (such as regulatory or shareholder approvals); (2) the risk that the transaction could be less accretive than expected, or even dilutive, to onsemi’s earnings per share, and that anticipated cost synergies, revenue enhancements, or other expected benefits may not be fully realized or may take longer to materialize than anticipated; (3) the possibility that onsemi will incur significant transaction-related and other costs in connection with the proposed transaction, which may exceed current estimates, including unforeseen expenses or liabilities; (4) the risk that onsemi may fail to realize the expected benefits from the proposed transaction, including difficulties or delays in integrating the acquired business or operations that could result in additional costs, liabilities, or disruptions to current operations; (5) the risk that any announcements relating to, or the completion of, the proposed transaction could have adverse effects on the market price of onsemi’s stock, whether due to the transaction itself or general market volatility; (6) the risk of unforeseen liabilities or future capital expenditures arising out of the transaction; (7) adverse changes in global or regional economic, financial, political, or regulatory conditions—including geopolitical tensions, public health crises, or supply chain disruptions—that may negatively impact onsemi’s or Allegro’s operations; (8) challenges related to the execution of onsemi’s business strategy, including risks associated with research and development, product demand, and competitive pressures; (9) the risk that key personnel may depart or that onsemi may encounter difficulties in recruiting critical employees; (10) the possibility that any governmental or regulatory entity may delay, restrict, or impose adverse conditions on the proposed transaction; (11) the potential for litigation, regulatory investigations, or other legal proceedings that could incur significant costs, liabilities, or delays; and (12) other risks and uncertainties detailed in onsemi’s filings with the Securities and Exchange Commission (the “SEC”), including in Part I, Item 1A, “Risk Factors,” of onsemi’s Annual Report on Form 10-K for the fiscal year ended December 31, 2024 (filed with the SEC on February 10, 2025), and any subsequently filed Quarterly Reports on Form 10-Q or Current Reports on Form 8-K, and in other documents that onsemi may file from time to time with the SEC. Should one or more of these risks or uncertainties materialize, or should any underlying assumptions prove incorrect, actual results may differ materially from those expressed or implied by these forward-looking statements. onsemi undertakes no obligation to update or revise any forward-looking statements, except as required by law, and readers are cautioned not to place undue reliance on them, which speak only as of the date of this document.
Important Information for Investors and Security Holders
This document relates to a proposal by onsemi for a transaction to acquire Allegro. In furtherance of this proposal, and subject to future developments, onsemi may file one or more registration statements, tender offer statements, prospectuses, or other documents with the SEC. This document is not a substitute for any prospectus, tender offer statement, or other document that onsemi may file with the SEC in connection with the proposed transaction. Investors and security holders are urged to read the tender offer statement(s), registration statement(s), prospectus(es), and any other document(s) filed with the SEC carefully and in their entirety if and when they become available, because they will contain important information about the proposed transaction. Any definitive tender offer statement(s) or prospectus(es) (if and when available) will be mailed to stockholders of Allegro, as applicable. Investors and security holders will be able to obtain free copies of these documents (if and when available), and other documents filed with the SEC by onsemi, through the SEC’s website (http://www.sec.gov).
No Offer or Solicitation; Participants in the Solicitation
This document shall not constitute an offer to sell, or a solicitation of an offer to buy, any securities, nor shall there be any sale of securities in any jurisdiction in which such offer, solicitation, or sale would be unlawful before registration or qualification under the securities laws of that jurisdiction. No offering of securities shall be made except by means of a prospectus meeting the requirements of Section 10 of the Securities Act. This document is neither a solicitation of a proxy nor a substitute for any proxy statement or other filing that onsemi may make with the SEC.
About onsemi
onsemi (Nasdaq: ON) is driving disruptive innovations to help build a better future. With a focus on automotive and industrial end-markets, the company is accelerating change in megatrends such as vehicle electrification and safety, sustainable energy grids, industrial automation, and 5G and cloud infrastructure. onsemi offers a highly differentiated and innovative product portfolio, delivering intelligent power and sensing technologies that solve the world’s most complex challenges and leads the way to creating a safer, cleaner and smarter world. onsemi is recognized as a Fortune 500® company and included in the Nasdaq-100 Index® and S&P 500® index. Learn more about onsemi at www.onsemi.com.
onsemi and the onsemi logo are trademarks of Semiconductor Components Industries, LLC. All other brand and product names appearing in this document are registered trademarks or trademarks of their respective holders.
View source version on businesswire.com: https://www.businesswire.com/news/home/20250305708032/en/
Krystal Heaton
Director, Head of Public Relations
onsemi
(480) 242-6943
Krystal.Heaton@onsemi.com
Parag Agarwal
Vice President - Investor Relations & Corporate Development
onsemi
(602) 244-3437
investor@onsemi.com
Source: onsemi
FAQ
What is the acquisition price offered by onsemi (ON) for Allegro MicroSystems?
What premium does onsemi's offer represent for Allegro shareholders?
How does onsemi plan to finance the Allegro acquisition?
What is the strategic rationale behind onsemi's proposed acquisition of Allegro?
When did onsemi first approach Allegro with an acquisition offer?
