Shares of Allegro MicroSystems (NASDAQ:ALGM) experienced a sharp decline in premarket trading today, tumbling 8% after ON Semiconductor (NYSE:ON) announced its decision to withdraw its offer to acquire the circuit manufacturer.
The move comes roughly a month after Onsemi, also known as ON Semiconductor, increased its bid to $35.10 per share, valuing Allegro at approximately $6.9 billion.
Allegro had previously rejected this offer, deeming it "inadequate."
In a statement released Tuesday, Onsemi explained its withdrawal, citing the lack of progress in negotiations.
"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," said Onsemi CEO Hassane El-Khoury.
The failed acquisition attempt follows a period of market uncertainty for Onsemi.
In February, the chipmaker reported fourth-quarter results that fell short of expectations, with CEO El-Khoury acknowledging the ongoing "market downturn" and labeling 2025 as an "uncertain" year.
Following the news of the withdrawn offer, shares of Onsemi saw a more modest decrease, down less than 1% in premarket trading approximately 30 minutes before the market opened.