U.S. power and sensing semiconductor corporations onsemi will acquire edge artificial intelligence (AI) solutions corporations Synaptics for about $7 billion (about 10.77 trillion won). Following AI data centers, the transaction targets the physical AI market, including automobiles, robots, and industrial equipment.
On the 25th, onsemi said it signed an acquisition agreement with Synaptics through an all-stock exchange. Synaptics shareholders will receive 1.350 shares of onsemi common stock for each Synaptics share they hold. The transaction terms reflect a premium of about 19% based on the volume-weighted average price (VWAP) of both corporations over the most recent 10 trading days.
When the transaction is completed, Synaptics shareholders will own about 12% of onsemi on a fully diluted basis. The boards of both corporations unanimously approved the agreement. The acquisition is expected to be completed in mid-2027, subject to approval by Synaptics shareholders and regulators. One member of the Synaptics board will join the onsemi board.
Through this acquisition, onsemi plans to expand into intelligent systems corporations that bundle power, sensors, connected computing, and control. Physical AI refers to systems in which machines sense data in the real world, make judgments, then move or adapt to their environment.
Synaptics is a corporations with edge AI (Edge AI) computing, human-machine interface (HMI), and wireless connectivity technologies. HMI is input and control technology that helps people and machines interact. Synaptics' Astra platform is an edge AI platform that combines an AI processor, Neural Processing Unit (NPU), Wi-Fi, Bluetooth, global positioning system (GPS), and open-source software.
Onsemi has strengths in power and sensing semiconductors for automobiles, industry, and AI data centers. The company plans to broaden its business scope to AI applications that operate in physical environments, such as Autonomous Driving, robots, augmented reality (AR), and Virtual Reality (VR), by adding Synaptics' computing and connectivity technologies.
Hassane El-Khoury, onsemi's chief executive officer (CEO), said, "As AI moves beyond the cloud into the physical world, including automobiles and industry, the next wave of innovation depends on systems that sense, decide, act, and adapt in real time," and noted, "The acquisition of Synaptics will position onsemi at the intersection of the four key pillars of physical AI."
Synaptics CEO Rahul Patel explained that the two corporations can provide integrated solutions and development platforms across Edge AI by combining AI-native computing, connectivity, and HMI with onsemi's intelligent power and sensing technologies.
With this transaction, onsemi expects the total addressable market (TAM) for 2030 to increase by $30 billion to reach $243 billion. TAM refers to the total market size that corporations can target. The company expects the deal to be accretive to non-GAAP earnings per share (EPS) within 18 months after closing and to generate $200 million in annual synergies.
An impact is expected on Korea's industrial sector as well. Onsemi has touchpoints with automakers such as Hyundai Motor and Kia in vehicle power semiconductors, and Synaptics has transacted with Samsung Electronics and LG Electronics in the smart TV and home appliance chip markets. With the combination of the two companies, competition to supply vehicle and home appliance Edge AI Semiconductor could intensify.