On 2 November 2026, the American technology company Marvell Technology announced an agreement to acquire Lumentum Holdings for $115 billion, including debt obligations. This is one of the largest corporate deals of the year, which is set to strengthen Marvell’s position in its competition with Broadcom in the artificial intelligence infrastructure market. The deal was reported by Reuters and has also been confirmed in a joint press release from the companies.
Terms of the agreement between Marvell and Lumentum
Under the terms of the agreement, Lumentum shareholders will receive 4.5 Marvell shares for each Lumentum share they hold. The offer value is approximately $1132 per Lumentum share.
This is 23.9% more than the value calculated on the basis of the companies’ share prices as at 28 October — the last trading day before reports of a possible takeover emerged.
Excluding debt, Lumentum’s equity value under the terms of the agreement stands at $102.54 billion.
Once the acquisition has been completed to shareholders Marvell will hold approximately 67% of the combined company, whilst Lumentum shareholders will hold the remaining 33%.
The boards of directors of both companies unanimously endorsed the agreement. However, its implementation still requires the approval of shareholders and the relevant regulatory authorities.
Why is Marvell acquiring a manufacturer of optical components?
Marvell specialises in the development of semiconductors, networking solutions and specialised processors for major technology companies. Its areas of focus include equipment for data centres and artificial intelligence infrastructure.
Lumentum develops lasers, optical components and data transmission technologies used in cloud services, telecommunications networks and data centres.
As the power of artificial intelligence systems increases, so does the need for the rapid transfer of vast amounts of data between processors and servers. Optical technologies make it possible to achieve high bandwidth and reduce energy consumption.
The merger will enable Marvell to combine its own semiconductor developments with Lumentum’s technologies. According to the companies’ estimates, their combined potential market following the merger could reach $550 billion. This is an assessment of market potential, not a forecast of actual revenue.
Competition with Broadcom and investment in artificial intelligence
According to Reuters, the acquisition of Lumentum is set to strengthen Marvell’s position in its rivalry with Broadcom — one of the key suppliers of specialised chips to tech giants.
Marvell is already collaborating with Amazon on the development of artificial intelligence chips. The company is also expanding its partnership with Google, which is developing its own computing infrastructure.
In February 2026, Marvell completed the acquisition of Celestial AI for $3.5 billion, strengthening its optical technology division.
The new agreement is on a much larger scale. It demonstrates the manufacturer’s commitment to further growth in investment in data centres, despite discussions amongst investors regarding the payback period for such expenditure.
When will the acquisition of Lumentum be completed?
The companies expect to finalise the deal in the first half of 2028. The current CEO of Marvell will continue to lead the combined business Matt Murphy.
There are also plans to appoint three representatives from Lumentum to Marvell’s board of directors, including its chief executive Michael Gerlston.
According to the companies’ forecasts, the merger will, over time, enable annual costs to be reduced by more than $1 billion thanks to business synergies.
As at 2 November 2026, the companies had signed a definitive acquisition agreement, but the merger has not yet been legally finalised. The next steps will depend on the approval of shareholders and regulators, and on the fulfilment of other conditions of the agreement.
