March 7, 2025 /SemiMedia/ — onsemi , a leading semiconductor manufacturer, made its first public offer to acquire sensor IC supplier Allegro Microsystems for $6.9 billion, including debt, on March 5, 2025. The offer of $35.10 per share represented an increase from the previously proposed $34.50 per share in September 2024. However, Allegro rejected the acquisition bid on March 6, 2025, calling the offer "insufficient."

onsemi  stated that the acquisition would merge two highly complementary companies, particularly in power and sensor technologies for automotive, industrial, and cloud computing applications. onsemi  CEO Hassane El-Khoury said in a statement that the deal would enhance the company's competitiveness in the automotive chip and sensor markets.

While public takeover bids are uncommon, onsemi 's move was a strategy to apply pressure on Allegro's shareholders. Despite the higher offer, Allegro rejected the proposal, asserting that the valuation did not reflect its current and future potential.

Allegro is a leader in advanced semiconductors, known for providing power and sensor solutions for motion control and energy-efficient systems used in automotive engines and safety systems, as well as data centers and factories. The company's largest shareholder is Japan's Sanken Electric, with a 32% stake. Allegro also recently announced that long-time executive Mike Doogue would replace Vineet Nargolwala as CEO, effective immediately.

Despite the increased offer from onsemi , Allegro expressed concerns over the ongoing slowdown in automotive chip demand. Analysts warn that the automotive chip market faces challenges, particularly as the U.S. electric vehicle market has slowed under the Trump administration's policies.