Lumentum Holdings has agreed to acquire Oclaro. The supplier of photonics products for optical networking and lasers based in Milpitas, California, and Oclaro, Inc. an optical network component and module maker announced that the companies have signed a definitive acquisition agreement. Under the terms of the agreement, which the boards of directors of both companies unanimously approved, Lumentum will acquire all of the outstanding common stock of Oclaro.
For each share of Oclaro stock held, Oclaro stockholders will be entitled to receive $5.60 in cash and 0.0636 of a share of Lumentum common stock. The transaction values Oclaro at $9.99 per share or about $1.8 billion, based on the closing price of Lumentum’s stock on March 9, 2018, of $68.98. The transaction value represents a premium of 27% above Oclaro’s closing price on March 9, 2018 and a premium of 40% over Oclaro’s 30 day average closing price. At closing, Oclaro stockholders are expected to own about 16% of the combined company.
The transaction is scheduled to close in the second half of calendar 2018, subject to Oclaro stockholder approval, antitrust regulatory approval in the US and China, and other customary closing conditions.
“Joining forces with Oclaro strengthens our product portfolio, broadens our revenue mix, and positions us strongly for the future needs of our customers. Oclaro brings its leading Indium Phosphide laser and Photonic Integrated Circuit and coherent component and module capabilities to Lumentum,” said Alan Lowe, Lumentum’s President and CEO.
“I am very pleased that two of the optical industry leaders, Oclaro and Lumentum, will join forces. Together, we will be an even stronger player in fiber optic components and modules for high-speed communications and a market leader in 3D sensing. This is a fantastic combination for all of our stakeholders, including stockholders, employees, customers and partners,” said Greg Dougherty, Oclaro’s CEO.