Breaking News! On Semi Reportedly Planning to Acquire Allegro Microsystems

According to sources, sensor IC supplier Allegro Microsystems has attracted acquisition interest from a larger competitor, ON Semiconductor (On Semi). Over the past few months, On Semi has been working with advisors on a potential acquisition of Allegro.

Other potential buyers may also emerge, and Allegro has not yet indicated whether it is open to a sale.

Semiconductor companies looking to strengthen their position in the automotive sector may consider acquiring Allegro.

Allegro’s stock has declined approximately 31% over the past year, leaving the Manchester, New Hampshire-based company with a market capitalization of about $4.1 billion. During the same period, On Semi’s stock has dropped 42%, bringing its market value to $19.8 billion.

Recently, Allegro announced that longtime executive Mike Doogue will take over as the company’s President and CEO, replacing Vineet Nargolwala, who held the role for nearly three years.

Allegro’s largest shareholder is Japan’s Sanken Electric Co., which owns approximately 32% of the company.

Allegro develops advanced semiconductors and describes itself as a leader in power and sensing solutions for motion control and energy-efficient systems. Its products are used in automotive engines, safety systems, data centers, and factories. On Semi also develops power and sensing technologies for the automotive, industrial, and cloud computing sectors.

Analysts have warned that automotive chipmakers may face sales pressure as the U.S. electric vehicle market slows under Donald Trump's administration.

On Semi has announced a restructuring plan aimed at reducing operational costs, which is expected to result in approximately 2,400 job cuts across its global business divisions by 2025.

In February, On Semi projected that its first-quarter revenue would fall short of Wall Street expectations due to weak demand for its automotive chips.