While continuing to recommend to shareholders the agreement it signed with Lumentum (NASDAQ:LITE), the board of Coherent, Inc. (NASDAQ: COHR) says it will engage with II-VI Inc. (NASDAQ:IIVI) to explore the offer II-VI has made for the company (see “II-VI trumps Lumentum, MKS Instruments with new bid for Coherent”). II-VI is the third company to bid for control of Coherent, following Lumentum and MKS Instruments (NASDAQ:MKSI). II-VI has offered more money for Coherent than its two competitors.
The Coherent board says the pending discussions are part of its review of the unsolicited bid. The board members add that they are still evaluating the bid from MKS Instruments as well. The Coherent board has not indicated how long the review processes will take.
“Coherent has determined to engage in discussions with II-VI to further evaluate the comparative benefits and risks of II-VI's proposed transaction relative to Coherent's pending transaction with Lumentum, including the near and long-term financial opportunities of each transaction, the expected completion timing of each transaction, and the closing risks associated with each transaction,” the board said via a press release.
Those closing risks include potentially running into objections from regulatory authorities. China’s State Administration for Market Regulation (SAMR) has held up multiple deals, including the merger of II-VI and Finisar as well as the recently consummated Cisco/Acacia Communications combination. II-VI asserts that its product line has fewer redundancies with Coherent’s when compared with those of Lumentum and MKS Instruments, rendering it the safest option.
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