American chipmaker onsemi has decided to terminate its proposal to acquire rival Allegro MicroSystems for $35.10 per share.
Announced in March 2025, the proposed deal valued Allegro at $6.9bn, including debt.
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The decision comes after onsemi concluded there was “no actionable path forward” for the acquisition.
In a statement, onsemi stated that it still believes merging the two companies would have united two highly complementary businesses, benefiting their respective customers and delivering immediate value to Allegro shareholders.
onsemi added that it will now focus on existing opportunities to bolster stockholder value.
The company plans to continue allocating capital towards its existing share repurchase programme.
onsemi president and CEO Hassane El-Khoury said: “While we continue to believe that a combination with onsemi would be beneficial to all stakeholders of both companies, after careful consideration, we have decided to withdraw our acquisition proposal given the reluctance of Allegro’s board of directors to fully engage and explore our proposal.”
“onsemi is well-positioned, both strategically and financially, and we remain sharply focused on executing on our core growth initiatives while pursuing our value-enhancing capital allocation approach. With market-leading technology, a robust innovation pipeline, and a clear strategic roadmap, we continue to see significant long-term opportunities in our core markets of automotive, industrial, and AI data centres.”
The latest development comes after onsemi announced a restructuring plan in February 2025, that will result in approximately 2,400 job cuts across its global business divisions this year.
The restructuring plan, approved by management, includes cost-cutting measures to adjust expenses in response to current business conditions while maintaining progress towards long-term financial goals.
The company has initiated the restructuring plan and expects to incur charges of $50m to $60m related to the layoffs.
Most of these costs are expected to be recorded within the current year, the company said.
In June 2024, onsemi also announced an investment of up to $2bn to establish a silicon carbide (SiC) semiconductor manufacturing facility in the Czech Republic.
