Lumentum and Cloud Light Technology have entered into a definitive agreement under which Lumentum will acquire Cloud Light in a deal valued at approximately $750 million. Cloud Light designs, markets, and manufactures advanced optical modules for automotive sensors and data center interconnect applications. The deal, Lumentum said, combines advanced optical interconnect technologies based on chip-scale photonic integration with highly automated packaging and manufacturing technologies. Cloud Light’s optical transceiver products for hyperscale cloud customers complement Lumentum’s existing portfolio of laser transmitters and other integrated components for data center transceivers, Lumentum added. According to Lumentum, the acquisition is expected to deliver a more-than fivefold expansion in its cloud intra data center served opportunity. This served opportunity is expected to grow at a compound annual growth rate of over 30% and exceed $10 billion through 2028, driven by investments to support the rapid proliferation of artificial intelligence and machine learning applications. Nearly all of Hong Kong-based Cloud Light’s more than $200 million revenue in the last 12 months was derived from 400G or higher speed transceiver sales. In the most recent quarter, over half of Cloud Light’s optical transceiver revenue was derived from 800G modules. Lumentum said that, in addition to cloud data center and data center interconnect systems, Cloud Light’s product development and high-volume manufacturing also hold implication of network edge applications. The transaction has been unanimously approved by the boards of directors of both companies and by Cloud Light’s shareholders. It is expected to close by the end of the calendar year.