If $mrvl acquires $lite, it would likely be accepting heavy dilution to secure scarce lasers and an optical switching business that sits alongside its electrical switch silicon.
Marvell’s bargaining power vis-à-vis module makers would increase, raising the question of whether the deal would be approved by regulators.
$cohr will benefit from tighter laser supply and other DSP manufacturers will also benefit as Lumentum’s Cloud Light transceivers compete with the module makers that buy Marvell DSPs; some may move DSP volume toward Broadcom, Credo and others.