onsemi Amends Synaptics Acquisition: $123 per Share in Cash, About $5.7 Billion

Chipmakers onsemi and Synaptics said on October 1 that they have amended their June 25 merger agreement: onsemi will acquire Synaptics for $123 per share in cash, an all-cash deal worth about $5.7 billion, compared with roughly $7 billion under the prior agreement. The companies said the amendment followed an unsolicited competing bid from a third party. onsemi makes chips for the automotive, industrial and data center markets, while Synaptics works on touch, display and biometrics technologies.

The revised terms

According to onsemi, the deal is expected to be immediately accretive to its non-GAAP earnings per share and provides value certainty for Synaptics shareholders. "As was the case when we initially announced the acquisition, Synaptics addresses an important aspect of our strategic direction, and we believe the revised merger agreement represents a more financially attractive transaction for our shareholders," said onsemi President and CEO Hassane El-Khoury. He added that the all-cash deal delivers more value through lower total consideration and that beyond the previously announced $200 million of annual run-rate synergies, revenue synergies and insourcing of part of Synaptics' production should add benefits from 18 months post-close.

El-Khoury also said Synaptics, with its strong growth outlook and attractive gross margins, complements growth in onsemi's AI data center business and brings highly profitable human-machine interface and sensing businesses that generate stable cash flows.

Why the deal changed

The original agreement was all-stock: onsemi would have exchanged 1.35 of its own shares for each Synaptics share. According to The Wall Street Journal, onsemi traded at $118.74 in June but had slid to about $80 a share by the time revised terms were struck. According to Investing.com, onsemi shares rose more than 5.7% in after-hours trading while Synaptics gained 12.4%.

The Synaptics board, after review with its financial and legal advisors, unanimously determined that the amended transaction continues to be in the best interests of the company and its shareholders. "By transitioning to an all-cash structure, we are providing value certainty at a meaningful premium as compared to current value," said Synaptics President and CEO Rahul Patel.

Financing and timeline

The deal will be financed with cash on hand and committed financing; onsemi has obtained fully committed debt financing from Morgan Stanley. The amended agreement no longer includes a closing condition tied to onsemi's financing.

The deal is still expected to close by mid-2027, subject to approval by Synaptics shareholders, required regulatory approvals and other customary closing conditions. The transaction has already been approved by the US Federal Trade Commission (FTC), and regulators in other jurisdictions are reviewing it.