Semiconductor company onsemi is selling 2 chip production facilities to cut manufacturing costs and improve gross margin, Cryptopolitan, a blockchain media outlet, reported on July 7 local time. The move is seen as restructuring to respond to a recent slowdown in semiconductor business conditions and a heavier financial burden after its acquisition of Synaptics.

onsemi plans to sell its Mountain Top plant in Pennsylvania and its production facility in Tarlac, the Philippines. The company expects the asset reshuffle to save about $35 million a year, or about 53 billion won, in costs.

The first asset to be sold is the Mountain Top production facility. Sweden-based MEMS specialist Silex Microsystems is set to acquire the plant, and the deal is being pursued with a target of completion by January 2028.

The relatively long timeline is due to the production transfer. onsemi plans to gradually move products made at the plant to other in-house production sites to avoid disruptions to customer supply. onsemi and Silex explained that they are focused on maintaining supply chain stability through an extended transition period.

The second asset to be sold is the Tarlac plant in the Philippines. Taiwan-based semiconductor back-end company Greatek Electronics will acquire the facility, and the transaction is expected to be completed within 3 to 6 months.

The two companies agreed to cooperate during the handover to keep production and customer orders stable. onsemi also plans to carry out production transfers and customer support in parallel so that plant operations are not interrupted.

The industry sees the sale as a profitability-focused business reshuffle rather than a simple asset disposal. The semiconductor market has recently seen growth slow as demand for automotive and industrial chips weakens, and companies are putting more weight on cost efficiency than on expanding capacity.

onsemi has faced growing investor concerns particularly after its acquisition of Synaptics. It recently acquired Synaptics in an all-stock deal worth about $7 billion, but its share price has fallen about 23 percent since then. The market is interpreted as having been concerned about the financial burden from the acquisition and integration costs.

In this situation, cutting fixed costs by streamlining production facilities and improving gross margin has emerged as onsemi's priority task. The company expects the cost savings secured through the sale to help defend profitability even during a downturn in business conditions.

Still, the production transfer process remains a variable. If the plant transfer is delayed beyond plan or problems occur during the production switch, the possibility of affecting customer supply cannot be ruled out. The view is that onsemi has repeatedly stressed the deal timeline and supply continuity to minimise such risks.

Ultimately, the plant sale is seen as a strategic reshuffle aimed at improving the cost structure and restoring profitability beyond the level of a simple asset disposal. Whether the cost savings materialise as planned and the production transfer is completed without disruptions is cited as the key variable that will determine success.