Lumentum Holdings Inc. is in advanced talks to get laser maker Coherent Inc. to buy, according to people familiar with the matter, in a deal that would combine two companies whose products are used in everything from laser eye surgery to semiconductor manufacturing.
A cash-and-stock deal could happen this week, assuming talks don’t fall apart, people said. No exact terms could be learned, but Coherent had a market value of $ 3.7 billion at Friday’s close, while Lumentum’s was $ 8 billion.
Based in Santa Clara, California, Coherent makes lasers and related products used in medical and scientific equipment, industrial applications, and semiconductor manufacturing. It was founded in 1966.
Milpitas, California-based Lumentum primarily makes optical components used in cloud networks, data transmission and submarine communications. It also has a laser segment of offerings used in sheet metal and printed circuit board manufacturing. It became a standalone company in 2015 when it spun off from JDS Uniphase Corp.
Shares of Lumentum are up about 40% in the past year, while those of Coherent are down about 10% over the same period, compared to the 17% rise of the S&P 500.