ON Semi to buy Sanyo’s chip business

Phoenix, Ariz. — ON Semiconductor Corp. has announced it will purchase Sanyo Semiconductor Co. Ltd., a subsidiary of Sanyo Electric Co. Ltd., and other assets related to its semiconductor business, for $366 million in a cash and stock transaction. The acquisition is expected to boost ON Semi’s manufacturing scale, broaden its product portfolio and expand its presence in the Japanese market.

This acquisition will add new capabilities to ON’s product mix ranging from microcontrollers and custom application specific integrated circuits (ASICs) to integrated power modules and motor control devices for the consumer, automotive and industrial markets.

The transaction also is expected to provide Sanyo Semiconductor’s customers with access to advanced front-end mixed-signal and analog manufacturing, and ultra-high-volume back-end facilities.

“The pending acquisition of Sanyo Semiconductor is another significant step by ON Semiconductor to solidify its position as a premier global supplier of high-performance, energy efficient silicon solutions with increased manufacturing scale and an expanded addressable market,” said Keith Jackson, president and CEO of ON Semiconductor, in a statement.

“By combining these two highly complementary businesses, we will be better positioned to capture growth on a global scale. We believe the union of ON Semiconductor and Sanyo Semiconductor will greatly enhance our presence in the automotive and consumer end-markets and significantly strengthen our geographic presence in the Asia-Pacific region. Strategically, this acquisition is expected to provide us with increased access to an important part of the global semiconductor market — the Japanese market, where Sanyo Semiconductor has a more than 50 year operating history, and a longstanding presence at leading electronics manufacturers,” he added.

Based on the most recently completed quarter, Sanyo Semiconductor’s annualized revenue was approximately $1.2 billion and the annualized revenue of the combined entity would be approximately $3.5 billion, according to ON Semiconductor.

The acquisition is expected to be completed before the end of 2010.