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Coherent Determines Revised Buyout Offer From II-VI To Be Financially Best Fit

Coherent, the provider of lasers and laser-based technologies, deemed the revised buyout offer from II-VI Incorporated as a “Company Superior Proposal.”

Per the terms of the revised proposal, the manufacturer of engineered materials and optoelectronic components will pay $170 in cash and 1.0981 shares of II-VI for each share of Coherent (COHR).

Coherent intends to terminate the merger agreement with California-based manufacturer and seller of optical and photonic products, Lumentum Holdings (LITE), entered into this January. The company has said the same to Lumentum unless Coherent receives a favorable revised proposal from Lumentum by March 11, 2021.

Coherent previously agreed to be acquired for $100 in cash and 1.1851 shares of Lumentum common stock for each share of Coherent. Further, it received two revised proposals from Lumentum.

Under the first proposal, each share of Coherent common stock was offered to be exchanged for $175 in cash and 1.0109 shares of Lumentum common stock, while the other proposal offered $170 in cash and 1.0109 shares of Lumentum common stock. Both proposals also included a significantly higher termination fee for accepting competing acquisition proposals. (See Coherent stock analysis on TipRanks)

Last month, Coherent also received an unsolicited acquisition proposal from MKS Instruments, in which each share of Coherent common stock was offered to be exchanged for $115 in cash and 0.7473 per share of MKS (MKSI) common stock. Further, MKSI’s revised proposal offered each share of Coherent common stock to be exchanged for $135 in cash and 0.7516 of a share of MKS common stock.

Therefore, after a thorough review of all proposals, the company’s board of directors, in consultation with financial and legal advisors, unanimously determined II-VI’s (IIVI) revised acquisition proposal to be the best fit.

On Feb. 11, Benchmark Co. analyst Mark Miller downgraded the rating to Hold from Buy on the stock.  

Meanwhile, the consensus rating on the stock is a Hold. That’s based on unanimous 6 Holds. Looking ahead, the average analyst price target stands at $210.33, putting the downside potential at about 10.6% over the next 12 months. Shares jumped 88.6% over the past year.

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