March 4, 2025 /SemiMedia/ — onsemi is reportedly exploring the acquisition of sensor IC supplier Allegro Microsystems and has been working with advisors on the potential deal, sources familiar with the matter said. Allegro has not yet decided whether to accept the offer and may attract other bidders.

Allegro specializes in motion control and power and sensing solutions for energy-efficient systems, serving applications in automotive engines, safety systems, data centers, and industrial sectors. Its largest shareholder, Japan’s Sanken Electric, holds approximately 32% of the company. Recently, Allegro appointed longtime executive Mike Doogue as its new President and CEO.

This move aligns with onsemi’s strategy to strengthen its automotive semiconductor portfolio. The company, which develops power and sensing technologies for automotive, industrial, and cloud applications, recently lowered its Q1 revenue forecast due to weak automotive chip demand. Additionally, onsemi announced a restructuring plan to cut approximately 2,400 jobs globally by 2025 to reduce operating costs.

In the market, Allegro’s stock has dropped around 31% over the past year, with a current market capitalization of $4.1 billion. Analysts warn that the slowdown in the U.S. EV market could put pressure on automotive chipmakers' sales.