Marvell to Acquire Lumentum in $115 Billion Deal

According to Marvell Technology, the company has reached an agreement to acquire data center optical technology manufacturer Lumentum Holdings in a transaction valued at approximately $115 billion in enterprise value. The deal ranks among the largest technology acquisitions in history and highlights the growing importance of optical technologies in the artificial intelligence (AI) industry.

Under the all-stock agreement, Marvell shareholders will own approximately 67% of the combined company, according to a joint statement. The announcement confirms earlier reports that the two Silicon Valley companies were nearing a deal. Both companies expect the transaction to close in the first half of 2028.

Based on compiled transaction data, the acquisition represents the largest merger and acquisition (M&A) deal by equity value announced this year. It would also rank among the largest technology transactions globally, excluding the merger of SpaceX and xAI. The deal reflects how growing AI investment is accelerating consolidation across multiple industries, including semiconductor manufacturing, specialized technology, data center infrastructure, and power generation.

Lumentum shares have gained 128% this year, closing at $840.70 last Friday and giving the San Jose-based company a market capitalization of approximately $76 billion. Marvell shares have also risen 131% this year, bringing its market capitalization to approximately $172.2 billion as of Friday.

Lumentum develops lasers and other optical technologies that enable high-speed data transmission. These components play a critical role in AI infrastructure by allowing data centers and telecommunications networks to transfer large volumes of information between servers, facilities, and other connected systems.

Marvell already sources laser technology from Lumentum and has been expanding its investments in optical connectivity and photonics technologies for data center infrastructure. Earlier this year, Marvell acquired photonics company Celestial AI, further strengthening its position in next-generation optical interconnect solutions.

Nvidia also announced an agreement in March to invest $2 billion in Lumentum. The partnership includes cooperation in photonics, a technology that uses light rather than conventional copper connections to transmit data. Optical interconnects can support higher bandwidth and improved energy efficiency, making them increasingly important for AI data centers and high-performance computing systems.

In addition to its optical technology investments, Marvell is working with Amazon's cloud computing division and Microsoft to develop custom AI chips. In August, the company also reached a chip agreement with Google's parent company, Alphabet, to support Google's Tensor Processing Units (TPUs).

The acquisition underscores the growing strategic importance of optical technologies, photonics, and high-speed connectivity in AI infrastructure. As demand for computing capacity continues to increase, these technologies are becoming essential to connecting processors, servers, and data center systems efficiently.