According to insiders, Allegro Microsystems Inc. is attracting acquisition interest from its larger competitor, ON Semiconductor.

Insiders say that Phoenix based ON Semiconductor has been working with consultants in recent months to seek the acquisition of Allegro. Due to the privacy nature of this matter, informed sources have requested anonymity.

They added that Allegro may have other suitors and the company has not yet indicated whether it is willing to accept a potential sale.

Insiders suggest that semiconductor companies interested in enhancing automotive capabilities may consider acquiring Allegro.

The representative of ON Semi refused to comment. Allegro's representative did not immediately respond to a request for comment.

Since this year, the stock price of Allegro has fallen by about 31%, and the market value of the company headquartered in Manchester, New Hampshire is about 4.1 billion dollars. During the same period, the stock price of ON Semiconductor fell by 42%, with a market value of $19.8 billion.

Last week, Allegro announced that it will replace its CEO Vineet Nargolwala, who has been in office for nearly three years, with Mike Doogue, who has served as its CEO for a long time.

According to data compiled by Bloomberg, Allegro's largest shareholder is Japan's Sanken Electric Company, holding approximately 32% of the shares.

Allegro develops advanced semiconductors and claims to be a leader in motion control and energy-saving system power and sensing solutions. Its products are used for automotive engines and safety systems, as well as data centers and factories. On Semi also develops power and sensing technologies for the automotive, industrial, and cloud computing fields.

Analysts warn that as the Donald Trump administration leads to a slowdown in the US electric vehicle market, car chip manufacturers may face sales pressure.

Allegro Microsystems, Inc. (NASDAQ: ALGM) produces sensor integrated circuits (ICs) and analog power ICs.

Since announcing a $375 million debt refinancing plan in January, the company's stock price has been significantly rising since 2025. The plan replaces the existing loan with a first lien term loan due in 2030 and extends the maturity of the old debt.

Allegro Microsystems (NASDAQ: ALGM) has also lowered its interest expense forecast for the fourth quarter of 2025 from $7.8 million in the third quarter to approximately $6 million.

The performance and guidance for the third quarter of 2025 are also strong. The company reported revenue of $177.9 million, higher than the expected $176.34 million. Non GAAP earnings per share were $0.07, lower than the expected $0.06. The guidance for the fourth quarter of 2025 predicts continuous revenue growth (ranging from $180 million to $190 million), with non GAAP earnings per share of $0.03 to $0.07.