onsemi (NASDAQ:ON) has publicly disclosed its proposal to acquire Allegro MicroSystems (NASDAQ:ALGM) for $35.10 per share in cash, valuing the company at an implied enterprise value of $6.9 billion.
The announcement comes after what onsemi describes as six months of unsuccessful attempts to engage in private discussions with Allegro's board.
The latest proposal, submitted on February 12, 2025, represents an increase from onsemi’s initial offer of $34.50 per share made on September 2, 2024.
"We believe the combination of onsemi and Allegro would bring two highly complementary businesses together, benefitting our respective customers and delivering immediate value to Allegro shareholders," stated Hassane El-Khoury, President and CEO of onsemi.
He highlighted Allegro's strong position in magnetic sensing and power ICs for the automotive and industrial sectors, and noted that the combined entity would create a "diversified leader in automotive, industrial and AI data center applications."
"While we would have preferred to reach an agreement with Allegro privately, the decision to make our proposal public reflects our conviction in the merits of a combined company, which we believe is in the best interests of Allegro and onsemi shareholders," El-Khoury added.
He urged Allegro's board and management to engage in "good faith discussions" regarding the proposed transaction.
onsemi argues that the acquisition represents a "natural strategic fit" due to the companies' complementary strengths in the automotive and industrial markets.