Marvell, a prominent designer of custom chips, has announced its acquisition of Lumentum, an optical chip and networking equipment maker, in a landmark all-stock deal valued at $115 billion including debt. The transaction values Lumentum’s equity at approximately $80 billion, with Marvell offering 4.5 shares of its common stock for each Lumentum share. This deal ranks among the largest in the technology sector, surpassing previous major deals such as Microsoft’s $68.7 billion purchase of Activision Blizzard in 2022 and Dell’s $67 billion acquisition of EMC in 2016.

A notable aspect of this transaction is the involvement of Nvidia, a shared key shareholder in both companies. Earlier this year, Nvidia invested $2 billion in Lumentum to support its research, development, and fabrication expansion as part of a strategic agreement to acquire advanced laser components. In the same timeframe, Nvidia also invested $2 billion into Marvell to strengthen its portfolio in optical networking and chip technology, highlighting the chipmaker’s central role in Nvidia’s AI ecosystem ambitions.

With the integration of Lumentum, Marvell aims to position itself as a leading entity in the AI connectivity market by combining capabilities in chips and data center technologies. The merger promises to create a comprehensive product lineup that addresses the growing demands of artificial intelligence infrastructure, with enhanced offerings spanning from optical components to networking solutions designed for high-performance computing environments.

The deal is expected to finalize during the first half of 2028, contingent upon approvals from the shareholders of both companies as well as regulatory bodies. Following completion, the combined company will likely have a significant influence on the AI and data center hardware sectors, epitomizing the trend toward consolidation in technology industries driven by the rapid advancement of AI and related infrastructures.