Onsemi to sell two chipmaking plants to cut costs

July 7 (Reuters) - Chipmaker Onsemi on Tuesday said it will sell two manufacturing facilities as part of broader push to cut costs and boost profit margins.

Shares of the company were down more than 3% in premarket trading. They have gained nearly 75% this year.

Here are some details:

• Onsemi makes power and sensing chips used in electric vehicles, factories and AI data centers.

• The move is part of its "Fab Right" strategy to cut costs, improve efficiency and direct resources toward its most competitive and scalable operations, the company said.

• Onsemi's facility in Tarlac, Philippines will be sold to Taiwanese chip firm Greatek Electronics, which specializes in semiconductor packaging and testing. The deal is expected to close in the next three to six months.

• Its Mountain Top, Pennsylvania, site will go to Swedish semiconductor company Silex Microsystems; the transaction is expected to close in January 2028, giving Onsemi time to move production to other facilities.

• The company did not disclose the financial terms of the deals.

• Both sites will keep running during their transition periods, and Onsemi has agreed to a long-term supply deal with Greatek to ensure customers are not disrupted.

• Together, the sales are expected to save Onsemi around $35 million annually, with initial savings beginning in 2027 and the full benefit realized in 2028.

(Reporting by Anhata Rooprai in Bengaluru; Editing by Sahal Muhammed)