ON Semiconductor reached an agreement to acquire Synaptics through an all-stock transaction. The deal carries an enterprise value of approximately $7 billion, according to a Thursday announcement. Under the terms of the agreement, ON Semiconductor will issue 1.35 shares for every share of Synaptics held by its current shareholders.

This acquisition offers Synaptics shareholders a roughly 19% premium relative to the volume-weighted average prices of both stocks over the previous 10 trading days. The move signals a strategic push to integrate Synaptics's specific hardware capabilities into a broader semiconductor portfolio aimed at high-growth sectors.

Management expects Synaptics's artificial-intelligence compute platform and human-machine interface technology to drive growth. These assets provide the connectivity solutions needed to satisfy demand for AI that interacts with the physical world. The transaction combines specialized interface technology with existing semiconductor manufacturing scale.