Onsemi Cuts Synaptics Deal To $5.7 Billion All-Cash After Rival Bid Forced Renegotiation
A competing offer that Synaptics' board briefly deemed superior forced onsemi to restructure its merger, slashing the total price by roughly $1.3 billion.
Onsemi agreed Thursday to buy Synaptics for $123 per share in cash — an aggregate of roughly $5.7 billion — replacing a $7 billion all-stock deal signed in June after an unsolicited competing bid forced both sides back to the table. The revised terms, disclosed in an 8-K filed with the SEC, convert the entire consideration from onsemi stock to cash and eliminate any financing condition from the closing requirements.
What The Revised Deal Says
The amended and restated merger agreement, executed October 1, replaces the original June 25, 2026 deal in its entirety. Under that earlier agreement, Synaptics shareholders were to receive a fixed exchange ratio of 1.35 onsemi shares per Synaptics share — a structure that tied the deal's value directly to onsemi's stock price.
That structure became a problem. Onsemi's shares had fallen to roughly $80 by the time the revised terms were struck, down from about $118.74 at the time of the original announcement, according to reporting by QZ. The slide effectively eroded the value of the all-stock consideration and created an opening for a competing bidder.
The new agreement pays Synaptics shareholders $123 per share in cash, with no financing condition attached. Onsemi obtained fully committed debt financing from Morgan Stanley to fund the purchase, the companies said in their joint press release.
Synaptics employees who hold unvested restricted stock units, performance stock units, or market stock units at closing will have those awards converted into onsemi equity at a ratio equal to $123.00 divided by onsemi's volume-weighted average share price over the five trading days ending three days before closing, according to the 8-K.
How The Competing Bid Triggered The Renegotiation
The chain of events began September 2, when Synaptics received an unsolicited, non-binding proposal from an unidentified strategic party — referred to only as "Party A" in onsemi's previously filed registration statement — to acquire all outstanding Synaptics shares, the SEC filing states.
Synaptics' board, together with a special committee of independent directors, reviewed the proposal and engaged with the unnamed party. After that engagement, the board determined in good faith — in consultation with outside legal counsel and its financial advisor — that the revised proposal from the strategic party constituted a "Superior Proposal" under the terms of the original merger agreement.
That determination triggered further negotiations between Synaptics and onsemi. Onsemi ultimately improved its terms sufficiently that the board reversed course: it unanimously approved the amended agreement and declared it advisable and in the best interests of Synaptics shareholders, concluding that the competing proposal no longer qualified as a superior offer.
Regulatory Status And What Remains Pending
The U.S. Federal Trade Commission has already cleared the transaction under the Hart-Scott-Rodino Act, according to the 8-K. Regulatory reviews in other jurisdictions remain ongoing, and closing is also conditioned on the absence of any legal restraint in specified jurisdictions that would block the deal.
Before the merger can close, Synaptics must file a preliminary proxy statement with the SEC and obtain approval from a majority of its outstanding shares. The transaction is expected to close by mid-2027, pending that shareholder vote and the remaining international regulatory sign-offs.
On the synergies front, onsemi had previously announced $200 million in annual run-rate cost synergies under the original deal. The company now says it has identified additional value through revenue synergies and by insourcing a portion of Synaptics' production — though those incremental benefits are not expected to materialize until more than 18 months after closing.
SYNA shares climbed about 14% to $121.00 in Friday trading after the deal was disclosed following Thursday's close.
The next concrete milestone is Synaptics' preliminary proxy filing with the SEC, which must precede the shareholder vote required before the $5.7 billion deal can close by mid-2027.
Sources
- 8-K Filing — SYNAPTICS Inc (SYNA) — SEC EDGAR
- Exhibit ef20083029_ex99-1.htm — SYNAPTICS Inc 8-K exhibit — SEC EDGAR
- Exhibit ef20083029_ex99-2.htm — SYNAPTICS Inc 8-K exhibit — SEC EDGAR
- Onsemi agrees to buy Synaptics for $123/share in cash in revised deal (SYNA:NASDAQ) | Seeking Alpha — seekingalpha.com
- onsemi revises Synaptics acquisition to all-cash $5.7B deal — qz.com
- Onsemi revises Synaptics deal to $123/sh all-cash, shares of both soar — sg.finance.yahoo.com
- onsemi and Synaptics Announce Revised Merger Agreement — globenewswire.com
