Custom chip designer Marvell Technology has agreed to acquire optical components maker Lumentum Holdings in an all-stock transaction valued at $115 billion including debt, with an equity value of roughly $80 billion. The deal, announced Monday, ranks among the largest technology acquisitions on record, eclipsing Microsoft’s $68.7 billion purchase of Activision Blizzard in 2022 and Dell’s $67 billion buyout of EMC in 2016. Marvell will issue 4.5 of its common shares for each Lumentum share, a structure that ties the combined entity’s fate to Marvell’s stock price between now and a projected closing in the first half of 2028.
Nvidia owns a piece of both sides
The transaction draws a tight circle around Nvidia, which holds significant stakes in both companies. In March, the GPU maker invested $2 billion in Lumentum as part of a multi-year supply agreement for advanced laser components, funding the target’s research and fab expansion. Later that same month, Nvidia put another $2 billion into Marvell to accelerate its optical networking and chip portfolio. The common shareholder effectively financed the supply chain on both ends before the two vendors agreed to merge.
The AI connectivity pitch
Marvell frames the combination as a play to own the full stack of AI infrastructure connectivity, spanning silicon, optical modules and data-center systems. Lumentum brings lasers and photonic components that convert electrical signals into light for high-bandwidth links; Marvell contributes custom ASICs, digital signal processors and switching silicon. The argument is that integrating the photonics layer with the silicon layer removes interface friction and speeds time-to-market for the 1.6-terabit and 3.2-terabit optical engines that next-generation AI clusters will require.
Regulators and a long runway
The deal faces a lengthy approval process. Shareholders at both companies must vote, and antitrust reviews in the United States, Europe and China will scrutinize the concentration of optical networking IP in a single vendor. The first-half-2028 target implies a review period of roughly eighteen months, during which the exchange ratio stays fixed at 4.5 Marvell shares per Lumentum share. If Marvell’s stock slides, the effective purchase price drops with it, a risk the market will price in long before any regulatory green light arrives.