According to people familiar with Lumentum Holdings, there are advanced talks about the laser manufacturer Coherent Inc. for sale in an agreement that will combine two companies whose products are used in everything from laser eye surgery to semiconductor manufacturing.
A cash-and-stock deal could come together as early as this week, assuming the talks do not fall apart, the people said. Exact terms could not be learned, but Coherent had a market value of $ 3.7 billion at the end of Friday, while Lumentum was $ 8 billion.
Santa Clara, California, Coherent, manufactures lasers and related products used in medical and scientific equipment, industrial applications and semiconductor manufacturing. It was established in 1966.
Lumentum, based in Milpitas, California, mainly manufactures optical components used in cloud networking, data transmission and submarine communications. It also has a laser segment with offerings used for the manufacture of sheet metals and circuits. It became a stand-alone company in 2015 when it was spun off from JDS Uniphase Corp.
Lumentum’s shares have risen by about 40% over the past year, while Coherent’s shares have fallen by about 10% over the same period compared to the 17% rise of the S&P 500.