Subsequent Event

3 Months Ended

Oct. 02, 2021

Subsequent Events [Abstract]

Subsequent Event

Subsequent Event

On November 4, 2021, Lumentum and NeoPhotonics Corporation (“NeoPhotonics”) announced a merger agreement (the “Merger Agreement”). Under the terms of the Merger Agreement, NeoPhotonics stockholders will receive $16.00 per share in cash for each NeoPhotonics share they own. This equates to a total transaction price of approximately $918 million. Lumentum will provide up to $50 million in interim debt financing to NeoPhotonics to help fund capital expenditures and increased working capital associated with NeoPhotonics’ growth plans. The cash consideration will be funded from the combined company’s balance sheet.

The Merger Agreement contains certain termination rights for both Lumentum and NeoPhotonics and provides that upon termination of the Merger Agreement under specified circumstances (including termination by NeoPhotonics to accept a superior proposal), NeoPhotonics may be required to pay Lumentum a termination fee of $27.5 million. The Merger Agreement further provides that if the Merger Agreement is terminated for failure to obtain antitrust approval, Lumentum may be required to pay NeoPhotonics a termination fee of $55.1 million; and if Lumentum takes certain specified actions, (including entering into any definitive agreement for an acquisition by stock purchase, merger, consolidation, amalgamation, purchase of assets, license or otherwise of any ownership interest or assets of any Person) that cause a material delay in, or results in the failure of, the consummation of the Merger, Lumentum may be required to pay NeoPhotonics an additional termination fee of $36.7 million.

The Boards of Directors of Lumentum and NeoPhotonics have unanimously approved the transaction and the Merger Agreement. The transaction is subject to customary closing conditions, including the absence of certain legal impediments, the expiration or termination of the required waiting periods under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended, receipt of any required antitrust and regulatory approvals, and approval by the holders of a majority of the outstanding shares of NeoPhotonics common stock. The transaction is not subject to any financing condition. The transaction is expected to be completed in the second half of calendar year 2022.