King of Hearts, CC BY-SA 3.0; 2011 archive crop.
Marvell Technology agreed Monday, November 2, to buy Lumentum in an all-stock deal with an implied enterprise value of about $115 billion, the companies said in a joint announcement. The acquisition has not closed; the companies expect to complete it in the first half of 2028, subject to shareholder votes, regulatory approvals and other closing conditions.
Lumentum shareholders would receive 4.500 Marvell shares for each Lumentum share they own. Using the companies’ unaffected October 28 closing prices, the agreement implies a value of about $1,132 per Lumentum share, a premium of approximately 23.9%. The exchange ratio is fixed, so the dollar value of the stock consideration can change with Marvell’s share price.
The proposed combination would join Marvell’s chips and networking technology with Lumentum’s lasers and optical equipment. The companies say the aim is to improve how data moves through artificial-intelligence infrastructure, including connections between data centers and within advanced chip packages.
After closing, current Marvell shareholders would own about 67% of the combined company and Lumentum shareholders about 33%, on a fully diluted basis. Marvell Chairman and CEO Matt Murphy would remain chairman and CEO. Three Lumentum directors, including CEO Michael Hurlston, would join Marvell’s board.
Both boards unanimously approved the agreement. The companies said they see more than $1 billion in potential annual cost savings and expect the transaction to increase Marvell’s adjusted earnings per share in the first year after closing. Those are company forecasts, not completed results.
JBizNews Desk | Silicon Valley
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