Marvell Agrees to Buy Lumentum in $80 Billion All-Stock Deal Valued at $115 Billion With Debt
Marvell will give Lumentum shareholders 4.5 Marvell shares for each Lumentum share in a deal the companies expect to close in the first half of 2028, subject to shareholder and regulatory approval, joining chip design with optical parts used in AI data centers.
Marvell Technology agreed on Monday to acquire Lumentum in an all-stock deal with an equity value of about $80 billion and an enterprise value of about $115 billion when debt is included, according to TechCrunch and The Wall Street Journal.
Under the terms, Lumentum shareholders will receive 4.5 shares of Marvell common stock for each Lumentum share they own. The companies said Marvell shareholders will own about 67 percent of the combined company and Lumentum shareholders will own about 33 percent.
The implied value was about $1,132 per Lumentum share, a premium of about 23.9 percent over the October 28 closing price, before reports of a possible deal surfaced. Because the exchange ratio is fixed, the amount Lumentum shareholders finally receive will move with the Marvell share price.
What the deal joins together
Marvell designs custom chips and other parts that move data around data centers. Lumentum makes lasers, chips and optical parts that carry data between servers. The companies said the combined business will cover electrical and optical connections, network switching, high-performance lasers and optical transceivers, with a total addressable market of $550 billion.
The companies said they expect more than $1 billion in annual cost savings and for the deal to add to Marvell’s non-GAAP earnings per share in the first year after closing. Marvell Chairman and Chief Executive Matt Murphy will stay as chairman and chief executive of the combined company, and three Lumentum directors will join the Marvell board, including Lumentum Chief Executive Michael Hurlston.
The two companies have a shared investor in Nvidia. TechCrunch reported that Nvidia invested $2 billion in Lumentum in March as part of a multi-year agreement to buy Lumentum laser parts, and that Nvidia invested $2 billion in Marvell later that month.
Market reaction and next steps
Investors gave the deal a cool reception on Monday. The Wall Street Journal reported that shares in both companies fell sharply in afternoon trading, with Lumentum down 15 percent, and that Marvell shares had fallen 13 percent last week after a Bloomberg report said the companies were close to an agreement.
The deal still needs approval from shareholders of both companies and from regulators. The companies said they expect it to close in the first half of calendar year 2028 if those approvals are granted.
Reporting based on coverage by TechCrunch, The Wall Street Journal and BigGo Finance.
