ON Semiconductor Reportedly Eyeing Acquisition of Allegro Microsystems
February 27, 2025 – Industry sources reveal that ON Semiconductor (On Semi) is exploring a potential acquisition of Allegro Microsystems, a leading supplier of sensor-integrated circuits. ON Semiconductor has reportedly been working with advisors for several months to facilitate this acquisition.
Key Developments in the Allegro Acquisition Talks
ON Semi's Interest in Allegro
The potential acquisition aligns with ON Semi’s strategy to expand its automotive and industrial semiconductor capabilities.
Allegro Microsystems specializes in motion control and power management solutions, which are widely used in automotive engines, safety systems, data centers, and industrial automation.
Competition for Allegro's Acquisition
While ON Semiconductor is a strong contender, other semiconductor companies seeking to strengthen their automotive presence may also bid for Allegro.
Allegro has not yet publicly stated whether it is open to a potential sale.
Allegro Leadership Transition
Recently, Allegro appointed longtime executive Mike Doogue as its new President and CEO, replacing Vineet Nargolwala, who led the company for nearly three years.
The leadership change could impact ongoing acquisition talks, depending on Allegro’s strategic direction under new leadership.
Major Shareholder Involvement
Japan’s Sanken Electric holds approximately 32% of Allegro’s shares, making it the largest stakeholder.
Any acquisition would likely require negotiations with Sanken Electric, which could influence the final outcome.
ON Semiconductor’s Strategic Expansion
ON Semiconductor has been aggressively expanding its footprint in the automotive, industrial, and cloud computing semiconductor sectors.
The company specializes in power and sensor technologies, making Allegro an ideal fit for its growth strategy.
If the deal proceeds, ON Semi could strengthen its position in key markets, including electric vehicles (EVs), advanced driver assistance systems (ADAS), and industrial automation.
Industry Implications
The potential acquisition highlights increasing M&A activity in the semiconductor sector, particularly as companies seek to secure critical AI, power management, and automotive semiconductor technologies.
If ON Semiconductor successfully acquires Allegro, it could become a dominant player in power and sensor solutions for next-generation vehicles and industrial applications.