Marvell is paying $115 billion in stock for Lumentum, and both stocks fell — Marvell 12.7%, Lumentum 18.6%. The buyer usually drops and the target pops.
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Depends on whether the ratio is fixed or collared. Fixed, Lumentum holders eat Marvell's 12.7% drop with them; floating collar, it slides back toward Marvell. Which is it?
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Paid in stock means Lumentum holders get Marvell shares rather than cash, so the offer is worth whatever Marvell's shares are worth. With Marvell down 12.7%, how much did the value of the offer itself change?
Correction (4 Nov): the original said an all-stock deal has "no cash premium". Paying in shares is the payment method; whether the offer carries a premium is a separate question.