ON Semiconductor (onsemi) has announced plans to acquire Synaptics in an all-stock transaction valued at nearly $7 billion, marking the largest acquisition in the company’s history. The deal is aimed at expanding onsemi’s capabilities in physical artificial intelligence (AI) and intelligent edge computing, strengthening its position in one of the fastest-growing segments of the semiconductor industry.
According to the company, the acquisition is expected to significantly broaden its product portfolio while increasing its total addressable market by $30 billion, bringing the opportunity to an estimated $243 billion by 2030.
Expanding into Intelligent Connected Systems
The acquisition will combine onsemi’s expertise in power management, sensing technologies, and silicon carbide solutions with Synaptics’ strengths in connected computing, human interface technologies, and AI-enabled edge processors.
Commenting on the transaction, ON Semiconductor CEO Hassane El-Khoury said the deal would immediately enhance the company’s connected computing capabilities while expanding its software ecosystem. He noted that customers are increasingly seeking intelligent, integrated systems capable of delivering real-time decision-making across automotive, industrial, and consumer applications.
The move reflects the growing importance of physical AI—technology that enables machines, vehicles, robots, and smart devices to interact intelligently with the physical world through advanced sensing, computing, and automation.
AI Acquisition Race Intensifies
The transaction comes amid a wave of strategic acquisitions across the technology sector as companies race to strengthen their AI capabilities.
Earlier this week, Qualcomm acquired infrastructure startup Modular to enhance its AI software portfolio, while Salesforce recently announced plans to purchase AI-powered customer service platform Fin in a deal valued at approximately $3.6 billion. These investments underscore the industry’s shift toward building comprehensive AI ecosystems that combine hardware, software, and edge intelligence.
Deal Structure and Market Response
Under the terms of the agreement, Synaptics shareholders will receive 1.350 shares of ON Semiconductor common stock for each Synaptics share they own. The transaction is expected to close by mid-2027, subject to shareholder approval and customary regulatory clearances. A Synaptics representative will also join ON Semiconductor’s board following the completion of the acquisition.
Investor reactions were mixed following the announcement. ON Semiconductor shares declined by approximately 6% in after-hours trading, while Synaptics shares rose around 13%, reflecting optimism over the acquisition premium.
With the acquisition, ON Semiconductor aims to strengthen its leadership beyond automotive and electric vehicle applications, positioning itself as a key player in the next generation of AI-powered intelligent systems.
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