Marvell to Acquire Lumentum in $115 Billion All-Stock Deal

10:58 AM EST, 11/02/2026 (MT Newswires) -- Marvell Technology (MRVL) has agreed to acquire optical and photonic products maker Lumentum (LITE) in an all-stock deal worth about $115 billion, as the companies aim to create a leader in artificial intelligence connectivity. Shareholders of Lumentum will receive a fixed exchange ratio of 4.5 shares of Marvell for each share they own, implying a consideration of about $1,132 per share, the companies said in a joint statement Monday. The transaction represents a premium of roughly 24% based on each company's closing share price on Oct. 28, the last trading day before market speculation began about a potential deal. Marvell's stock fell 7.1% in Monday trading, but has gained 115% so far this year. Lumentum dropped 11%, but its shares have surged 103% year to date. The companies aim to combine Marvell's custom silicon chip technologies with Lumentum's optical components and specialized semiconductor manufacturing capabilities to deliver AI connectivity solutions ranging from data centers to advanced semiconductor packages. "AI infrastructure is undergoing a fundamental architectural shift toward optical connectivity, creating an opportunity that comes along once in a generation," Marvell Chief Executive Matt Murphy said in the statement. "We intend to help shape the next era of AI connectivity and create exceptional stockholder value." The transaction is expected to expand the combined company's total addressable market to $550 billion and strengthen its ability to serve customers in emerging scale-up and scale-in markets. "Surging AI data traffic requires rapid hardware innovation, and this combination enhances our ability to deliver next-generation solutions at scale," Lumentum CEO Michael Hurlston said. "Together with Marvell, we will meet our customers' complete interconnect needs, spanning scale-across and scale-out today to scale-up and scale-in domains tomorrow." Murphy will continue as chairman and CEO of the combined company, while Hurlston will join Marvell's board of directors. The deal, which requires approval from both companies' shareholders and clearance from regulators, is expected to complete in the first half of the 2028 calendar year. Marvell's stockholders are anticipated to own 67% of the combined company, while Lumentum investors will hold the remaining 33% stake. Marvell expects the acquisition to be accretive to its adjusted earnings on a per-share basis in the first year after completion. The companies estimate the deal to generate more than $1 billion in annual run-rate cost synergies. The deal comes amid growing investor concerns about the returns technology companies can generate on their spending on AI infrastructure. Last week, Amazon (AMZN) reported third-quarter results below Wall Street's estimates as a massive ramp in AI investments sent free cash flow deep into negative territory. Google parent Alphabet (GOOG, GOOGL) said its free cash flow turned negative year on year in the third quarter, at $9.07 billion, while the outflow deepened sequentially. Earlier in the year, Marvell completed its acquisition of photonic fabric optical interconnects maker Celestial AI for $3.25 billion. Rival chipmaker Broadcom (AVGO) recently agreed to supply AI equipment to Claude maker Anthropic under a $63 billion financing arrangement. In March, Nvidia (NVDA) agreed to invest $2 billion each in Marvell and Lumentum. In June, the tech bellwether's CEO, Jensen Huang, called Marvell the next chip manufacturer to join the trillion-dollar club. Additionally, Marvell maintained the midpoint of its previously issued fiscal third-quarter revenue guidance at $3.15 billion, while narrowing the expected range to plus or minus 2% from plus or minus 5%. Price: 183.85, Change: -12.55, Percent Change: -6.39