Lumentum Holdings Inc. (NASDAQ: LITE) says it has received antitrust clearance from the People's Republic of China's State Administration for Market Regulation for the company’s pending $1.8 billion acquisition of fellow optical component and module developer Oclaro (see “Lumentum agrees to buy Oclaro for $1.8 billion”). With this milestone reached, Lumentum expects to close its Oclaro purchase on or around December 10, 2018.
The approval from China was necessary because such Chinese companies such as Huawei and ZTE would be customers of the combined company. Given the on and off trade tensions between the U.S. and China, there had been fear in some quarters that the approval might become a bargaining chip between the two countries, particularly when ZTE was attempting to reverse the ban on technology imports it had received from the U.S. Department of Commerce earlier this year (see “ZTE back in business as Commerce technology ban suspended”). Given the renewed conflict created when Canada apprehended Huawei’s CFO Meng Wanzhou December 1 at the request of U.S. authorities, the timing of the approval couldn’t have been better for Lumentum.
II-VI will require similar approvals from China for its announced acquisition of Finisar (see “II-VI to acquire Finisar for $3.2 billion”).
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