Lumentum agreed to be acquired by Marvell Technology for 4.5 Marvell shares per Lumentum share, a package worth $820 at Marvell's $182 price, while Lumentum fell to $750; the deal is expected to close in the first half of 2028. Lumentum traded at 26x forward earnings, below its five-year average of 30x, and the article says the stock would be about 17% higher at that average multiple than Monday's close. Its September-quarter revenue rose 136.5% to $1.26 billion, adjusted EPS of $4.57 beat its $4.05–$4.35 range, and it guided to $1.575–$1.625 billion revenue for the December quarter. The article identifies the main risk as an easing of the laser shortage, noting the CEO said parts were effectively sold out through early 2029 and that Coherent's report on Wednesday is the first test. Alphabet's Google Cloud revenue rose 103% and Arista guided to 38%–40% growth in 2027, suggesting customers are still spending heavily.
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- Marvell's Deal to Acquire Lumentum Could Be a Game Changer for the Stock
Marvell, up more than 130% in 2026 as of the end of October, has agreed to acquire Lumentum to combine its optical interconnect expertise with Lumentum's laser technology. The companies expect $1 billion in annual synergies, mostly from lower cost of goods sold, and a $17.7 billion annual revenue run rate before synergies. Lumentum shareholders will receive 4.5 Marvell shares per share, valuing Lumentum at an enterprise value of $115 billion, or about $1,132 per share, roughly a 24% premium to its pre-announcement close. Lumentum reported fiscal first-quarter revenue up 137% to $1.26 billion, while Marvell guided current-quarter revenue up 52%. The deal is expected to close in the first half of calendar 2028, and the article views Lumentum as a discounted way to gain exposure to Marvell, although the deal could still fail.
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- In one of the largest deals in tech history, Marvell buys Lumentum for $115B
Marvell, a custom chip designer, will acquire Lumentum in an all-stock deal with an enterprise value of $115 billion including debt and an equity value of about $80 billion, offering 4.5 Marvell shares for each Lumentum share. The deal ranks among the largest in tech history, compared with Microsoft's $68.7 billion purchase of Activision Blizzard in 2022 and Dell's $67 billion acquisition of EMC in 2016. Nvidia is a shared major shareholder: it invested $2 billion in Lumentum in March under a multi-year laser component agreement, and later that month invested $2 billion in Marvell. The transaction is expected to close in the first half of calendar 2028, subject to shareholder and regulatory approval.
- Marvell Slides 3%, Lumentum Drops 6% on $115 Billion All-Stock Merger Deal; Coherent Climbs 2%
Marvell Technology agreed to acquire Lumentum Holdings in an all-stock deal with an enterprise value of $115 billion. Each Lumentum share would convert into 4.5 Marvell shares, which Marvell says implies $1,132 per share and a 23.9% premium, with closing expected in the first half of calendar 2028. Marvell expects more than $1 billion in annual run-rate cost savings, and the combination would bring its chip design together with Lumentum's laser production for AI optical connectivity. Marvell fell 3% to $190.43 and Lumentum dropped 6% to $788.51, with Lumentum trading below the implied deal value, a gap the article says usually reflects doubts about Marvell stock as deal currency, the long road to closing and antitrust review. Lumentum's Q1 FY2027 revenue was $1.26 billion, compared with the $1.25 billion consensus.
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The proposed deal would be financed with stock and target the in-demand optical-networking market.
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Marvell (MRVL) shares fell 14.05% over the past week to $196.40 after reports of a possible takeover of Lumentum (LITE), and Marvell has issued no official statement. Lumentum's market cap is about $76.2 billion versus about $172.2 billion for Marvell, and the article says a deal would be a heavy lift, possibly requiring new stock or debt on top of $4.96 billion in existing debt. Marvell raised its fiscal 2027 revenue outlook to roughly $12 billion and fiscal 2028 to about $18 billion, and the stock trades at 26x forward earnings. Of 46 analysts covering the stock, 8 rate it Strong Buy, 32 Buy, 6 Hold and none Sell, with a consensus target of $340.56 implying 73.4% upside. Risks cited include reliance on a few hyperscalers and a beta of 2.26, and the fiscal third-quarter report, measured against guidance of $3.15 billion revenue and $1.10 non-GAAP EPS, is the next checkpoint.
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