The Marvell-Lumentum break fee is three numbers, and the antitrust one pays the seller more than its own break fee
Three fees, not one The Marvell–Lumentum merger agreement was signed on November 1, 2026 and filed as Exhibit 2.1 to Marvell's 8-K the next day ( d352474dex21.htm ). The 8-K summary leads with "$5.8 billion" and gets to the rest in one long sentence. The exhibit has three fees, in three paragraphs, and the arrangement between them is stranger than any single number. Section 8.2(b) — if Lumentum…
The merger agreement between Marvell and Lumentum, signed on November 1, 2026, outlines three termination fees totaling $13.7 billion. If Lumentum walks away, Marvell must pay $2.9 billion, while Marvell must pay Lumentum $5.8 billion if it exits the deal. In contrast, if Lumentum faces regulatory obstacles, it receives $3.2 billion from Marvell upon termination.
This arrangement, which pays the seller more than its own break fee, suggests that Marvell assumes the antitrust risk, which is paid regardless of whether the deal closes or is blocked by regulators. The 2:1 ratio between the two termination fees further emphasizes this point. The regulatory fee is triggered only if regulatory conditions at the deal's termination are unmet, excluding factors that can be resolved at closing.
Notably, if Marvell waives a restraint under another regulatory law, the fee remains applicable, making it a fee-preserving mechanism rather than a fee-avoiding one. The parties have a 21-month runway, with the Outside Date of November 1, 2027, extending to February, May, and August 2028, requiring that only regulatory conditions prevent the deal from closing.
Additionally, a competing deal within twelve months of termination, with a 50% ownership threshold, would not incur the fee, providing some protection for the seller.
Written by urgent.news from Dev.to's reporting — not their text. Machine-written — may contain errors; check the original before relying on it.
