According to Bloomberg News, there is growing interest from ON Semiconductor in acquiring Allegro Microsystems, a provider of sensor integrated circuits. Sources familiar with the matter revealed that ON Semiconductor has been collaborating with advisors over the past few months to explore the possibility of acquiring Allegro. The report from Bloomberg suggests that while ON Semiconductor is actively pursuing this acquisition, there is a chance that other potential buyers may also express interest in Allegro. However, Allegro has not made any public statements indicating its willingness to entertain offers for a sale.
The report also mentions that semiconductor companies seeking to enhance their automotive capabilities might view the acquisition of Allegro as an attractive opportunity. Allegro, based in Manchester, New Hampshire, currently has a market valuation of $4.11 billion, whereas ON Semiconductor, headquartered in Phoenix, Arizona, is valued at $19.83 billion, as per LSEG data.
On Monday, Allegro announced the appointment of Mike Doogue as its new president and CEO, taking over from Vineet Nargolwala. In contrast, ON Semiconductor revealed on Tuesday that it is implementing a restructuring plan to streamline operations and reduce costs. This initiative will lead to the layoff of approximately 2,400 employees across all business divisions worldwide by 2025.
Regarding financial performance, ON Semiconductor recently forecasted first-quarter revenue below expectations due to weakening demand for its automotive chips. While ON Semiconductor declined to comment on speculations and rumors, Allegro has not responded to Reuters’ request for comment on the matter.
The situation remains fluid, with the potential acquisition of Allegro Microsystems by ON Semiconductor generating significant interest within the industry.
