Allegro Microsystems (ALGM, Financial) experienced a significant stock drop after ON Semiconductor (ON) announced it had withdrawn its acquisition offer. Last month, ON increased its bid to $35.10 per share, valuing Allegro at approximately $6.9 billion. However, ON stated that it found "no viable path forward" for the acquisition.
ON's CEO expressed that the merger would have been beneficial for all stakeholders but cited Allegro's board's reluctance as the reason for retracting the proposal. Allegro had rejected the offer, considering it "insufficient."
Earlier this year, ON's fourth-quarter results fell short of expectations, and the CEO mentioned ongoing challenges in navigating a market downturn, with 2025 being described as a year of uncertainty.
