Littelfuse Acquires OnSemi’s Automotive Portfolio in a $104 Million Deal

Littelfuse is set to purchase a range of products including transient voltage suppression (TVS) diodes, switching thyristors, and insulated gate bipolar transistors (IGBTs) for automotive ignition from On Semiconductor for $104 million. These products generate around $55 million in annual sales. The deal is expected to finalize by the end of this month.

Ian Highley, the Chief Technology Officer of Littelfuse, stated, “This acquisition aligns perfectly with our strategy to grow in the power semiconductor market and strengthen our presence in automotive electronics. These new products complement our existing circuit protection business, bolster our channel partnerships, and enhance customer engagement.”

To support this acquisition, Littelfuse plans to invest about $30 million in its semiconductor manufacturing facilities. This investment aims to boost production capabilities, significantly expand the China fabrication facility, and transition the manufacturing of the newly acquired products. The transition will take place over the next few years, in coordination with customers’ schedules and needs. The anticipated productivity gains are expected to contribute to long-term profitable growth across Littelfuse’s semiconductor segment.

Meenal Sethna, Executive Vice President and Chief Financial Officer, mentioned, “After we complete the transfer of these products, we foresee EBITDA margins exceeding 30 percent. Despite initial costs including amortization, interest, and integration expenses, we anticipate that the acquisition will have a neutral effect on earnings per diluted share in 2016 and become profitable in 2017 and beyond.”

Wachtell, Lipton, Rosen & Katz is serving as the legal advisor for Littelfuse.