Here's Why ON Semiconductor Stock Crashed Hard Today
The company's acquisition announcement weighed on the stock today.
Overview
Investors in ON Semiconductor (NASDAQ: ON), or onsemi, went to sleep last night thinking they were holding a power and sensing chip company whose core automotive and industrial end markets were inflecting, while its AI data center revenue was booming and becoming significant for the company.
However, they woke up facing the prospect of becoming a technically integrated provider of power, sensing, and now connected computing, following the announcement of an agreement to buy Synaptics (NASDAQ: SYNA). Unfortunately, the initial reaction to the deal isn't positive, and onsemi has declined by more than 23% by 1 pm today.
Details
The all-stock transaction (1.35 shares of onsemi for every share of Synaptics) values the latter at $7 billion and "represents an approximately 19% premium to the volume weighted average closing prices of onsemi and Synaptics over the last 10 trading days," according to the press release.
Source
Originally published at www.fool.com.