June 25 (Reuters) - ON Semiconductor Corp said on Thursday it had agreed to acquire Synaptics in an all-stock deal valued at about $7 billion, its largest acquisition to date, as the chipmaker seeks to expand its presence in AI-enabled devices and so-called physical AI.
Under the terms of the agreement, Synaptics shareholders will receive 1.350 shares of Onsemi common stock for each Synaptics share. The exchange ratio represents a 19% premium based on the 10-day volume-weighted average closing prices of the two companies' stocks.
The acquisition is aimed at accelerating growth in so-called physical AI, which refers to AI embedded in devices and machines. Synaptics' connected-computing platform complements Onsemi's strengths in automotive, power and industrial markets, Onsemi CEO Hassane El-Khoury told Reuters in an interview.
"What Synaptics brings to us is this acceleration with a world-class connected compute platform that is already in the markets [that we play in]," El-Khoury said.
"That combination is going to create a market leader in what is to be known as the physical AI realm," he said.
Onsemi expects the deal to helpincrease the size of the markets it can target by $30 billion, to $243 billion by 2030.
Shares of Onsemi fell nearly 10% in extended trading, while those of Synaptics rose more than 10%.
The chipmaker also aims to capture growth from Synaptics’ human‑machine interface business and its broader technology and R&D in robotics and humanoid markets, El-Khoury said.
(Reporting by Milana Vinn in New York, Jaspreet Singh in Bengaluru; Editing by Anil D'Silva and Sanjeev Miglani)
