The bidding for control of Coherent Inc. (NASDAQ:COHR) continues, with II-VI (NASDAQ:IIVI) and Lumentum Holdings (NASDAQ:LITE) each bringing new offers to the table. Lumentum went first, topping the previous bid by II-IV (see “II-VI again tops Lumentum bid for Coherent”) with an offer filed yesterday of $220.00 per share in cash and 0.6100 shares of Lumentum common for a total of $6.9 billion. However, II-VI again trumped Lumentum with the announcement from Coherent this morning that it has offered $220 in cash and 0.91 of a share of II-VI common stock for each Coherent share – or, about $10 more per Coherent share than Lumentum’s offer.
Coherent issued a statement this morning in which it termed the latest II-VI bid as superior as defined in the most recent sale agreement it had negotiated with Lumentum (see "Coherent back in Lumentum’s corner"). The company’s board said it will terminate its agreement with Lumentum if it doesn’t receive an offer at least equal in value to that of II-VI by 11:59 p.m. Pacific Time on Monday, March 22, 2021.
While how long such back-and-forth can go on is anyone’s guess, both companies appear to have lined up financial partners to improve their positions. Lumentum said in discussing its latest offer that Silver Lake had agreed to a $1 billion equity investment in a Lumentum/Coherent combination. II-VI, meanwhile, appears to have lined up Bain Capital in a similar role, with Bain committing $1.5 billion, with as much as $650 million in addition to reduce leverage. The Bain funding complements $5.4 billion in fully committed debt financing from JP Morgan.
[Editor's Note: The details of the Bain funding are updated from the original version of this story.]
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