● Covered by 3 sources · 3 reportsHigh impact3 neutral
Marvell Acquires Lumentum for $115 Billion to Lead AI Connectivity Market
Key points
- Marvell will acquire Lumentum in an all-stock deal.
- The transaction has an implied enterprise value of $115 billion.
- The acquisition aims to create a leader in AI connectivity.
- Nvidia is a common shareholder in both Marvell and Lumentum.
- The deal is expected to close in the first half of 2028.
- Lumentum shareholders will receive 4.5 Marvell shares for each share they own.
- The deal represents a 23.9% premium over Lumentum's October 28 closing price.
- Marvell shareholders will own 67% of the combined company, Lumentum shareholders 33%.
- The acquisition is the second-largest tech transaction after the SpaceX-xAI merger.
- Marvell acquired Inphi for $10 billion in 2021.
- Marvell purchased Celestial AI for $3.5 billion.
Marvell to Acquire Lumentum in Major Tech Deal
Custom chip designer Marvell has signed an agreement to acquire optical chip and networking equipment maker Lumentum. The acquisition is an all-stock deal with an implied enterprise value of $115 billion, including debt, and an equity value of approximately $80 billion. This transaction ranks among the largest acquisitions in tech history, comparable to Microsoft's acquisition of Activision Blizzard for $68.7 billion in 2022 and Dell's purchase of EMC for $67 billion in 2016.
Focus on AI Connectivity Leadership
Marvell stated that the acquisition of Lumentum will position it as a leader in AI connectivity. The combined entity will offer products ranging from chips to data centers, integrating electrical and optical technologies. This move is intended to address the increasing connectivity demands driven by the buildout of artificial intelligence infrastructure.
Lumentum CEO Michael Hurlston noted the "enormous" opportunity presented by the deal in meeting these demands. Marvell CEO Matt Murphy indicated the merger would create a "new category of company" by seamlessly combining semiconductor and optical scale-up technology.
Deal Structure and Shareholder Information
Under the terms of the agreement, Marvell will provide 4.5 shares of its common stock for each share of Lumentum. As a fixed-ratio stock deal without cash, the final value will depend on Marvell's share price. Following the announcement, Marvell shares declined 13% and Lumentum's stock fell nearly 19% in trading.
Nvidia is a significant common shareholder in both companies. In March, Nvidia invested $2 billion in Lumentum to support its R&D and fab expansion, and later that month, invested $2 billion in Marvell to enhance its optical networking and chips portfolio.
Timeline and Approvals
The transaction is anticipated to close in the first half of calendar year 2028. Completion of the deal is contingent upon approval from both companies' shareholders and regulatory bodies.
Updates
- Lumentum shareholders will receive 4.5 Marvell shares for each share they own.
- The deal represents a 23.9% premium over Lumentum's October 28 closing price.
- Marvell shareholders will own 67% of the combined company, Lumentum shareholders 33%.
- The acquisition is the second-largest tech transaction after the SpaceX-xAI merger.
- Marvell acquired Inphi for $10 billion in 2021.
- Marvell purchased Celestial AI for $3.5 billion.
✨ This summary was generated by AI from the outlets' reporting listed below. It is not independently verified and may contain errors — check the original sources. How BrevFeed works →
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How outlets covered it
Marvell Technology Inc. will acquire Lumentum in an all-stock transaction valued at $115 billion, combining two major data center optics companies. This acquisition expands Marvell's optical infrastructure portfolio, positioning it as a key supplier of optical interconnect technologies for AI infrastructure.
Marvell Technology is acquiring optical components maker Lumentum in a fixed-ratio stock deal, valued at an implied enterprise value of $115 billion. This acquisition aims to combine electrical and optical technologies to address the growing connectivity demands of artificial intelligence infrastructure.
Marvell will acquire Lumentum in an all-stock deal valued at $115 billion, making it one of the largest tech acquisitions. This merger aims to establish Marvell as a leader in AI connectivity, combining its custom chip design with Lumentum's optical chip and networking equipment expertise.