II-VI Inc. has submitted a new takeover offer for Coherent Inc. valued at roughly $7 billion, as a frenzied bidding war for the laser maker nears a climax.
II-VI, which has been locked in a battle with Lumentum Holdings Inc. for Coherent, submitted a bid valued at roughly $285 a share, according to people familiar with the matter. It follows the latest offer from Lumentum, unveiled earlier Wednesday and worth around $275 a share.
The new offer from II-VI is made up of stock and $220 a share in cash, up from $195, the people said. It also has increased support from private-equity firm Bain Capital LP.
Santa Clara, Calif.-based Coherent’s board was planning to meet late Wednesday to compare the bids, the people said. Should II-VI’s be deemed superior, Lumentum would likely have a window to make a new offer or walk away—with a $200 million-plus breakup fee.
Coherent makes lasers and related products used in medical and scientific equipment, industrial applications and semiconductor manufacturing, a market that has a limited number of players and is poised to benefit as applications increase.
Coherent agreed Jan. 19 to sell itself to Lumentum in a cash-and-stock deal that at the time was valued at around $5.7 billion. Two other suitors—II-VI and MKS Instruments Inc.—soon emerged, and between the three of them Coherent will now have received around 10 subsequent bids. MKS appears to have bowed out.
Coherent’s shares closed at $256.82 Wednesday, nearly 70% above where they’d traded before the agreement with Lumentum.
Lumentum’s latest bid, worth $6.9 billion, consists of $220 in cash and 0.61 of a Lumentum share for each Coherent share and is backed by $1 billion from private-equity firm Silver Lake.
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Appeared in the March 18, 2021, print edition as ‘Bids for Laser Firm Coherent Go Higher.’