By Connor Hart
ON Semiconductor will sell two manufacturing facilities as part of its continuing efforts to optimize its footprint and improve its cost structure.
The chip maker on Tuesday said it will sell a facility in the Philippines to Greatek Electronics, a Taiwanese semiconductor company. It will additionally sell a facility in Pennsylvania to Silex Microsystems, a Swedish semiconductor company.
Terms of the sales agreements weren't disclosed.
OnSemi said the actions are expected to result in annual cost savings of about $35 million, with initial savings beginning next year and ramping in 2028.
Shares of OnSemi ebbed 2.6%, to $92.25, in premarket trading.
The sale of OnSemi's facility in the Philippines is expected to close within three to six months. OnSemi added that it has established a long-term supply agreement with Greatek to support continuing production and ensure continuity for customer commitments following the transition.
Meanwhile, the sale of the company's facility in Pennsylvania is expected to close in January 2028.
The extended transition period will allow OnSemi to transfer the products currently manufactured at the site to other facilities within its network, it said.
Both sales mark an important step in shaping a more focused and efficient manufacturing network, OnSemi said.
Write to Connor Hart at connor.hart@wsj.com