Marvell officially announced its all-stock acquisition of Lumentum, but both companies' stock prices initially rose and then fell. The reason is actually quite simple: 1️⃣ The "23.9% premium" was calculated based on MRVL's price of $251 before the rumors surfaced on October 28th. MRVL subsequently fell by about 24%, and at the current price of approximately $190, LITE's value per share is only about $856, lower than the rumored $914. With the premium gone, LITE shareholders naturally sold. 2️⃣ A fixed 1-for-4.5 exchange of MRVL shares makes LITE a "discounted version of MRVL." Arbitrageurs bought LITE and shorted MRVL, putting pressure on both sides. 3️⃣ MRVL will issue approximately 400 million new shares, increasing its share capital by nearly half. The market is concerned about dilution and consolidation as a light-asset chip design company acquires a heavy-asset optical component factory. 4️⃣ Settlement is expected in the first half of 2028. Chinese regulatory approval is the biggest variable; the longer the delay, the larger the discount. On the same day, both the Nasdaq and Semiconductor ETFs rose. This isn't due to the overall market, but rather a problem with the trading structure itself.