Marvell and Lumentum already share a buyer-supplier relationship, the former buying lasers from Lumentum, indicating that the deal can further simplify the supply chain.
Marvell technology is in advanced talks to buy photonic product maker Lumentum, in a mega deal that can push optical technologies to power artificial intelligence infrastructure. Potentially worth $83 billion, the deal could be announced next week.
The potential acquisition underlines how the AI boom has driven companies to pursue partnerships that can help them build infrastructure capable of handling high workloads. Lumentum has a market value of $83 billion, compared to Marvell’s $221 billion. According to estimates, the acquisition could mark one of the biggest technology telecom mergers.
Lumentum makes lasers and optical technologies, which can communicate data between servers and chips. Marvell is one of the biggest beneficiaries of the AI boom, driven by strong demand in custom AI chips. Marvell and Lumentum already share a buyer-supplier relationship, the former buying lasers from Lumentum, indicating that the deal can further simplify the supply chain.
Earlier this year Marvell also acquired the optical company Celestial AI in a $3.25 billion deal, reinforcing its strategy to shift towards optical transmission in AI technologies instead of conventional copper wiring. Nvidia has also taken a $2 billion stake in Lumentum to collaborate on photonics.
Marvell stocks fell by about 9 per cent on Wednesday, with the news of the deal while that of Lumentum rose by 11 per cent in extended trading.
