Wilson Sonsini and Davis Polk have scored lead roles in chipmaker Marvell Technology's $115bn all-stock acquisition of optical components maker Lumentum, in a major bet on the durability of the AI boom.
The takeover is one of the tech industry's largest to date and creates an “enormous” opportunity to meet growing connectivity demands from the AI infrastructure buildout, Lumentum CEO Michael Hurlston told CNBC.
Wilson Sonsini acted for Marvell on the deal, with the team led from San Francisco by partner Robert Ishii, head of the firm's M&A group. He also led the Wilson Sonsini team that advised Marvell on its $3.25bn acquisition of semiconductor startup Celestial AI last year and its $540m acquisition of networking equipment provider XConn Technologies earlier this year.
The firm also advised both Marvell and Lumentum earlier this year when the companies forged strategic partnerships and took related $2bn equity investments from Nvidia, with the teams led respectively by corporate partners Allison Spinner and Lisa Stimmell.
Davis Polk advised Lumentum this time, with a team led by Menlo Park-based M&A partner Alan Denenberg alongside corporate partners Michael Gilson, Tierney O'Rourke and Michael Diz, who joined the firm last year having been M&A co-chair at Debevoise & Plimpton.
Marvell's acquisition of Lumentum follows a recent selloff in chip stocks, as surging cash burn and rising debt at tech giants such as Alphabet and Amazon have deepened concerns about AI spending.
Lumentum manufactures components that enable AI processors and servers to communicate more quickly by using light instead of traditional copper wiring. These parts have become vital for preventing bottlenecks as data centres link thousands of chips that share data faster than copper wiring can handle.
As the tie-up is a fixed-ratio deal with no cash, the value will depend on the price of Marvell shares. The company said in a release that the deal has an implied enterprise value of $115bn for Lumentum.
Lumentum shareholders will receive 4.5 Marvell shares for each Lumentum share under the agreement, giving them a roughly 33% stake in the combined company, with Marvell investors owning the rest.
The deal is expected to close in the first half of 2028, subject to approval by Marvell and Lumentum stockholders, receipt of regulatory approvals and other customary closing conditions.
Qatalyst Partners served as lead financial advisor, and JP Morgan Securities and Goldman Sachs & Co. served as financial advisors to Marvell. Citigroup Global Markets and Evercore served as financial advisors to Lumentum.
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