TradingKey – Marvell Technology (MRVL) announced an all-stock acquisition of Lumentum (LITE), following which its shares came under continuous selling pressure. MRVL closed down 16.43% on Thursday at $133.55, touching an intraday low of $132.54 and falling back near a seven-month low.

The market is not questioning the long-term demand for AI optical communications; rather, it is concerned that Marvell paid too high a price to strengthen its related business. Under the agreement, Lumentum shareholders will receive 4.5 Marvell shares for each share of LITE held. The transaction implies an enterprise value of approximately $115 billion, representing a premium of about 23.9% over the stock price before the news emerged. Upon completion of…