• Complementary deal lacks significant overlaps
• Synaptics’ market position unlikely to raise major concerns
• Parties could still be steered toward normal review

US chipmaker onsemi’s proposed USD 7bn acquisition of sector peer Synaptics is likely to face close scrutiny from China’s State Administration for Market Regulation (SAMR), according to uninvolved antitrust lawyers with sector experience.

Announced on 25 June, the semiconductor transaction is subject to antitrust and foreign investment approvals. The merger agreement includes an initial long stop date of 25 June 2027, which may be extended by three-month increments up to three times. During an investor webcast, onsemi CEO Hassane El-Khoury confirmed that the deal is expected to face a Chinese regulatory review.

The deal parties have been preparing a SAMR filing for some time, a source familiar with the matter said.

The transaction is viewed as a complementary combination with limited horizontal overlap and no significant vertical relationship, according to an earlier analysis by this news service citing semiconductor analysts. While bundling theories could be explored, the companies largely serve distinct customer groups, making such concerns less straightforward, the analysis pointed out.

onsemi primarily supplies power management and sensing solutions to automotive and industrial customers, while Synaptics provides touch & biometric controllers, display & interface solutions, and wireless connectivity chips used in mobile devices, PCs and Internet of Things (IoT) applications.

Given the limited overlaps, SAMR’s review is likely to focus principally on Synaptics’ product markets, the lawyers said. One precedent is US chipmaker MaxLinear’s lapsed acquisition of Taiwanese flash controller maker Silicon Motion, which SAMR conditionally cleared in July 2023. In SAMR’s conditional approval decision, the regulator’s competitive assessment was concentrated largely on Silicon Motion’s products.

Synaptics’ market shares in its main product markets do not appear “problematically high” that would trigger significant competition concerns, one of the lawyers said. The growing presence of domestic Chinese suppliers across several of Synaptics’ product categories could also help alleviate potential market concentration issues, the same lawyer noted.

Synaptics is a leading supplier of capacitive touch-controller integrated circuits, with research reports estimating its global market share at approximately 14%–15%.

In the display driver integrated circuits (DDIC) market, Synaptics is also a major player, although its overall position remains relatively modest. Research reports indicate that Synaptics holds roughly 1.1% of the global DDIC market and around 4.1% of the narrower LCD mobile DDIC segment. Its competitive position is stronger in premium OLED mobile DDIC and automotive DDIC markets.

In wireless connectivity chips, Synaptics competes against Broadcom, Qualcomm and MediaTek, which together accounted for roughly 70% of the global market. While not generally viewed as a top-tier supplier, Synaptics has recently sought to strengthen its position through the introduction of Wi-Fi 7 IoT and AI-native chips.

Although Synaptics’ moderate market shares could theoretically make the transaction eligible for SAMR’s simplified review process, lawyers said the regulator may nevertheless encourage the parties to pursue a normal review in order to ensure there is an extensive third-party comment-seeking process, particularly given the strategic nature of the semiconductor industry.

A similar approach was taken in the Silicon Motion/MaxLinear review, where SAMR asked the deal parties to withdraw their original simplified filing and refile under normal procedure.

Another comparable case involved US semiconductor process equipment supplier Axcelis Technologies’ proposed acquisition of peer Veeco Instruments, which remains under SAMR review. After initially accepting the case under the simplified review track in January 2026, the Chinese antitrust regulator requested, following domestic complaints, that the deal parties withdraw and refile under normal procedure.

SAMR has increasingly directed parties in high-profile transactions to move from simplified to normal procedures, lawyers said. Examples over the past six months include ByteDance’s Moonton/PIF’s Savvy, Kenvue/Kimberly-Clark, DuPont’s aramid/Arclin, Jiangxi Shenghua/CATL, Johnson Matthey’s catalyst/Honeywell, and Teck Resources/Anglo American.

onsemi and Synaptics did not respond to requests for comment.

SAMR does not comment on ongoing deals.