Lumentum Stock Plunges 10%, Wiping Out $7.4 Billion, As Marvell Agrees To Buy It In $115 Billion Deal
Marvell's all-stock offer carries a roughly 24% premium, but the deal is not expected to close until the first half of calendar 2028.
Lumentum Holdings, which makes lasers and optical parts for AI data centers, fell 9.70% to $759.15 in Monday trading as of 9:47 a.m. ET, erasing $7.4 billion in market value, on the day Marvell agreed to buy it in an all-stock deal valued at $115 billion.
Terms of the all-stock offer
Lumentum holders would receive 4.5 Marvell shares per Lumentum share, a premium of about 24%. Lumentum shareholders would own about 33% of the combined company, the companies said.
Closing is expected in the first half of calendar 2028. The merger agreement carries reciprocal termination fees of $2.9 billion each, $5.8 billion combined, according to the company's filing.
The stock was on pace for its biggest one-day drop since Oct. 22, when it fell 11.5%.
A stock already up 128% this year
Lumentum makes optical and photonic products, including laser chips, optical modules and optical circuit switches, sold to cloud providers, AI infrastructure companies and network equipment makers. It reports as one segment.
Shares were up about 128% year to date at Friday's close, on October 30, far ahead of the S&P 500's gain of about 11%. Even so, the stock had slipped 13% over the prior month and sat 26% below its highest close of the past year, set on Oct. 6, as AI-spending worries weighed on optical stocks. A Bloomberg report that Marvell was in advanced talks had lifted the shares earlier in the week.
Record growth and a Thursday report
Fiscal first-quarter revenue reached $1.26 billion, a 136.5% annual jump, and the company's outlook for the next quarter is $1.575 billion to $1.625 billion.
Lumentum is scheduled to report results after the close on Thursday, Nov. 5.
Sources
- Marvell to purchase Lumentum for $115 billion as AI boom drives demand for connectivity — Yahoo Finance
- Marvell Stock: Chipmaker To Buy Lumentum | Investor's Business Daily — investors.com
- Marvell Strikes $115B Deal To Acquire Lumentum: CEO Sees ‘Once In A Generation’ Opportunity In AI Optical Shift — Yahoo Finance
- Lumentum Is Up 11% in a Week. Will Marvell Pay “Close to $100 Billion”? — Yahoo Finance
- Marvell Reaches $115 Billion Deal for Lumentum Holdings — news.bloomberglaw.com
- The company's filing (Lumentum Holdings) — SEC filing
- The company's filing (Lumentum Holdings) — SEC filing
- The company's filing (Lumentum Holdings) — SEC filing
- The company's filing (Lumentum Holdings) — SEC filing
- Lumentum Holdings — Form 10-K for the fiscal year ended 2026-06-27 (quarterly results) — SEC EDGAR
