In a high-stakes corporate maneuver under the Department of Justice’s watchful eye, Onto Innovation Inc. has trimmed its planned acquisition of Semilab International’s materials analysis business after the DOJ issued a “second request” for more information to review the merger. The move effectively reduces the purchase price to $495 million and carves out one of Semilab’s product lines from the deal.

The Massachusetts-based semiconductor equipment maker revealed in a Thursday SEC filing that the DOJ’s deeper inquiry triggered an extended waiting period under the Hart-Scott-Rodino (HSR) Act, which prohibits closing a deal until 30 days after the companies comply with federal information requests.

Instead of waiting, Onto Innovation and Hungary-based Semilab chose to amend the purchase agreement, refile the notice, and restart the 30-day countdown — a tactical move meant to keep the transaction on track amid rising antitrust scrutiny in the tech sector.

Reworked Deal Narrows Focus, Cuts $50 Million

Originally unveiled in June, Onto’s deal was valued at $545 million, including $475 million in cash and 706,215 shares of stock, to acquire Semilab’s U.S.-based materials analysis business. The portfolio encompassed four product lines designed to provide inline wafer contamination monitoring and materials interface characterization — critical tools for advanced chip manufacturing.

Under the revised terms, Onto dropped Semilab’s Fourier-Transform infrared spectroscopy reflectometry systems line — a business that generates about $13 million annually — to ease regulatory approval. The remaining divisions are projected to bring in around $120 million in annual revenue.

The new price tag now includes $432.3 million in cash and 641,771 shares of common stock, reflecting roughly a $50 million reduction from the original offer. Onto said it still expects the deal to close in 2025.

Onto’s Strategy: Adapt and Advance

In its SEC filing, Onto Innovation stated that both parties will withdraw their previous HSR filings and submit new notifications to the DOJ and Federal Trade Commission. “The company and the seller intend to continue working cooperatively with the DOJ and/or the FTC to obtain regulatory clearance … as expeditiously as possible,” Onto said.

The company positioned the acquisition as a key step in expanding its process control technology portfolio, aiming to capitalize on the growing demand for precision tools required by the use of exotic materials in semiconductor manufacturing.

Onto, which reported $987 million in revenue last year, serves a client base spanning wafer manufacturers, integrated circuit fabricators, and specialty device makers — including producers of LEDs and image sensors.

Regulatory Hurdles Reflect Wider Antitrust Crackdown

The DOJ Onto Innovation $500M suit represents a growing trend of intensified federal oversight over semiconductor mergers, as regulators aim to curb market consolidation in a critical technology sector. The Department’s “second request” signals heightened attention to the competitive dynamics between global chip equipment makers, even in cross-border transactions.

Neither Onto Innovation nor Semilab representatives responded to requests for comment as of Friday.

With the deal now reshaped and a new filing underway, Onto is betting on agility to navigate regulatory minefields — a test of strategy that could determine whether this $500 million play cements its position as a dominant force in semiconductor innovation or stalls under the weight of government scrutiny.