Marvell Agrees to Buy Lumentum for $115 Billion in Stock, Betting That AI Data Centres Will Run on Light
Marvell has agreed to buy optical-components maker Lumentum in an all-stock deal with an implied enterprise value of $115 billion, or about $1,132 a Lumentum share, a 23.9% premium to the October 28 close. Lumentum holders get 4.5 Marvell shares each and will own about 33% of the combined company. The companies claim more than $1 billion of annual cost savings. Closing is expected in the first half of 2028, subject to shareholder and regulatory approval.
Marvell is paying in its own shares, not cash, to own the lasers and optical parts that move data between AI chips, and investors marked both stocks down on the news. Marvell Technology and Lumentum said on Monday, November 2, that they have signed a definitive agreement for Marvell to acquire Lumentum in an all-stock transaction with an implied enterprise value of $115 billion. Marvell's 8-K says the merger agreement was signed on November 1.
The terms#
Lumentum stockholders will receive a fixed 4.5 Marvell shares for each Lumentum share. The companies put that at about $1,132 per share, a premium of about 23.9% to each company's closing price on October 28, which they call the last trading day before market speculation about a deal began. After closing, current Marvell holders will own about 67% of the combined company and Lumentum holders about 33%, on a fully diluted basis.
Both boards approved the deal unanimously. Matt Murphy stays on as chairman and CEO, and three Lumentum directors, including CEO Michael Hurlston, will join Marvell's seven-member board. The companies expect to close in the first half of calendar 2028, subject to approval by both sets of shareholders and by regulators.
What Marvell says it is buying#
The companies describe the combination as "a category leader in AI connectivity." They say it would let them co-design chips and optics end to end and sell pre-validated optical systems, and they claim a combined addressable market of $550 billion. They also project more than $1 billion in annual run-rate cost savings and say the deal would add to Marvell's non-GAAP earnings per share in the first year after closing. Those are the companies' own projections.
Bloomberg Law put the equity value at roughly $102.6 billion, against the $115 billion enterprise value that includes debt. Marvell chief executive Matt Murphy told CNBC the deal was "a double down on supporting Nvidia," which has invested in both companies.
A deal priced in a falling stock#
Because the price is fixed in shares, its dollar value moves with Marvell's stock, and the market's first verdict was harsh. CNBC reported that Marvell shares slumped 13% on Monday and Lumentum's sank nearly 19%, after both had been among the AI boom's big winners. The drop came days after the October 30 chip selloff, when, NBC News reported, Marvell fell about 10%.
Limits#
- The deal was announced before US markets opened on November 2, a few hours before this edition's window began. We include it because we had not covered it.
- The market-size, savings and earnings claims are the companies' forecasts. A closing date more than a year away leaves room for regulatory review to change or stop the deal.
- The $1,132 figure is implied by the exchange ratio at the reference prices; the value Lumentum holders actually receive depends on Marvell's share price at closing.
Sources#
- Marvell Technology: Marvell and Lumentum to Combine, Creating a Category Leader in AI Connectivity (November 2, 2026)
- Marvell Technology: Form 8-K current report (November 2, 2026)
- CNBC: Marvell to buy Lumentum in $115 billion deal in AI data-center bet (November 2, 2026)
- Bloomberg Law: Marvell to Acquire Lumentum in Historic $115 Billion Deal (November 2, 2026)