Marvell to Give Lumentum Shareholders 33% Stake in $115 Billion Deal
Marvell Technology ($MRVL) has agreed to acquire Lumentum Holdings ($LITE) in an all-stock transaction valued at $115 billion. Under the terms, Lumentum shareholders will receive 4.5 Marvell shares for each share they own, giving them approximately 33% of the combined company. Existing Marvell shareholders will retain about 67%.
The deal’s effective value has fallen as Marvell shares declined. The companies initially valued the offer at approximately $1,132 per Lumentum share, representing a 23.9% premium based on October 28 closing prices. However, Marvell shares fell about 22% between the initial deal reports and October 30. By Friday’s close, the 4.5-share exchange was worth roughly $884, below Lumentum’s implied pre-announcement price of about $914.
Lumentum’s latest results highlight its growth momentum. Revenue surged approximately 136% year over year to $1.26 billion, compared with 37% growth in Marvell’s latest reported quarter. Lumentum also secured a second major near-packaged and co-packaged optics design win, backed by purchase commitments exceeding $5 billion.
The combined company is expected to have a non-GAAP gross margin of 57%, slightly below Marvell’s standalone 58%. Marvell expects to generate more than $1 billion in annual cost savings, primarily through lower production costs. Its investor presentation estimates combined annualized revenue of $17.7 billion.
The transaction is expected to close in the first half of 2028, subject to regulatory approval. Marvell CEO Matt Murphy said the acquisition could help the company move beyond selling individual components toward offering complete optical modules.
The acquisition represents a major expansion of Marvell’s presence in optical technology. It follows the company’s February 2026 purchase of Celestial AI and is more than 10 times the size of its $10 billion Inphi acquisition in 2021.
Key risks include the decline in Marvell’s share price, the long wait until closing, potential regulatory hurdles, and possible channel conflicts with customers that compete in the optical-module market.
