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Marvell to acquire Lumentum in $115 billion all-stock deal
Marvell Technology has agreed to acquire optical component maker Lumentum in an all-stock deal that values Lumentum at an enterprise value of USD 115 billion. The companies plan to combine Marvell’s electrical interconnect and custom silicon with Lumentum’s lasers and optical transceivers as AI data centres move from copper to optical connectivity.
Under the agreement, Lumentum shareholders will receive a fixed 4.5 Marvell shares for each Lumentum share they hold when the deal closes, according to a joint press release from the two companies. Based on the share prices on 28 October, the last trading day before market speculation about a deal began, that corresponds to about USD 1,132 per Lumentum share, a premium of about 23.9%. After closing, Marvell’s current shareholders will own about 67% of the combined company and Lumentum’s shareholders about 33%.
The companies' reasoning starts with the limits of copper. As bandwidth requirements grow, AI infrastructure is moving towards optical solutions, and the industry is shifting from separate modular components towards integrated optics, where the electrical and optical parts have to be designed together. Marvell brings electrical and optical interconnect, network switching and custom XPUs. Lumentum brings high-performance lasers, optical transceivers, optical circuit switching (OCS) and its own compound semiconductor manufacturing, including indium phosphide.
“AI infrastructure is undergoing a fundamental architectural shift toward optical connectivity, creating an opportunity that comes along once in a generation,” says Matt Murphy, Chairman and CEO of Marvell.
The combined company’s portfolio is expected to span leading-edge CMOS, silicon photonics, compound semiconductors and advanced packaging, with connections ranging from links between distributed data centres to links inside advanced semiconductor packages. The companies put the total addressable market at USD 550 billion and expect more than USD 1 billion in annual cost synergies.
Murphy will remain Chairman and CEO. Three members of Lumentum’s board, including CEO Michael Hurlston, will join Marvell’s board, which currently has seven members. Both boards have approved the deal unanimously.
The deal is expected to close in the first half of 2028, subject to approval by both companies’ shareholders and by regulators.
