(Telecompaper) The latest move in the consolidating chip market will see ON Semiconductor acquire Fairchild Semiconductor for USD 2.4 billion cash. ON agreed to pay USD 20 per share for Fairchild, creating a leader in the power semiconductor market with combined revenue of approximately USD 5 billion per year. The new company will serve multiple markets, with a strategic focus on automotive, industrial and smartphones. ON said the takeover will add immediately to adjusted EPS and free cash flow, excluding any one-time acquisition-related charges. The company expects to achieve annual cost savings of USD 150 million within 18 months of closing the transaction. The company has secured a new credit line of USD 2.4 billion to help finance the deal, along with cash on hand. The debt financing commitment also includes provisions for a USD 300 million revolving credit facility, which will be undrawn at close. ON Semiconductor also said it remains committed to its share repurchase program, and the agreed upon financing provides flexibility to continue share repurchases going forward. Pending regulatory approval, the transaction is expected to close late in Q2 2016.