Leading photonics manufacturers agree to combine
The combination, say the companies, unites Coherent’s leading photonics and lasers businesses, including in the Microelectronics, Precision Manufacturing, Instrumentation, and Aerospace & Defense markets, with Lumentum’s leading Telecom, Datacom, and 3D Sensing photonics businesses, creating a diversified photonics technology company with significantly increased scale and market reach. The combination is expected to accelerate Lumentum’s penetration of the more than $10 billion market for lasers and photonics outside of communications and 3D sensing applications.
In addition, say the companies, the powerful R&D engine of the combined company will be primed to accelerate innovation in existing and future markets that need the unique capabilities that photonics bring. The combined company will be better positioned to serve the needs of a global customer base increasingly dependent on photonics to enable important end-market transitions including the shift to digital and virtual approaches to work and life, the transition to 5G in wireless networking, advanced bioinstrumentation, advanced microelectronics, and new materials for next generation consumer electronic devices, flat panel and OLED displays, communications equipment, electric and autonomous vehicles, and energy storage.
“As we look ahead,” says Alan Lowe, Lumentum President and CEO, “we are thrilled to join forces with Coherent to create one of the world’s largest and most diverse photonics technology companies with leading positions in the growing market for photonics. Coherent brings one of the most recognizable and respected brands in the photonics industry and a very talented and innovative team. Together, we expect to increase the pace of innovation, and to be at the forefront of the long-term market trends that are dependent on the capabilities of photonics.”
Andy Mattes, Coherent President and CEO says, “We are excited about the combination of Lumentum and Coherent, two iconic brands in their respective photonics markets. We are excited to bring Coherent’s strength in OLED display manufacturing, semiconductor wafer inspection, and life science instrumentation to Lumentum’s portfolio, to name but a few of the key applications we serve, and believe Lumentum’s expertise and scale in world class photonics components and systems will accelerate Coherent’s vertical integration and addressable market expansion in several high growth areas, such as directed energy in defense and precision battery welding in automotive.”
Under the terms of the agreement, which has been unanimously approved by the Boards of Directors of both companies, Coherent stockholders will receive $100.00 per share in cash and 1.1851 shares of Lumentum common stock for each Coherent share they own. At closing, Coherent stockholders are expected to own approximately 27% percent of the combined company.
In addition, two members of the Coherent Board will be appointed to the Lumentum Board, which will be expanded to nine directors, at the closing of the transaction. The transaction is expected to close in the second half of calendar year 2021 subject to the usual approvals.
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