NEW YORK (AP) — ON Semiconductor Corp. said Wednesday that it plans to buy Fairchild Semiconductor for about $2.3 billion in cash, to expand its products in the automotive, industrial and smartphone industries.

ON Semiconductor is offering $20 for each share of Fairchild. The combined company will have about $5 billion of revenue a year, Phoenix-based ON Semiconductor said.

The deal is expected to close in the second quarter of 2016.

ON Semiconductor said it expects the combined company to save it $150 million in costs within 18 months.

Shares of San Jose, California-based Fairchild Semiconductor International Inc. rose $1.52, or 8.5 percent, to $19.40 in afternoon trading Wednesday. ON Semiconductor Corp. shares fell 77 cents, or 7.2 percent, to $9.97.