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Jim Cramer Says Buy Marvell Stock on Inphi Acquisition

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Is Marvell a buy as sellers take the lead following its acquisition of Inphi? Jim Cramer put a check in the 'yes' column. 

"When Marvell buys a company with a much faster growth rate, what happens is its growth rate is pulled forward," Cramer said.

Marvell Technology (MRVL) - Get Report reached an agreement to acquire rival semiconductor company Inphi (IPHI) - Get Report in a cash-and-stock deal.

Marvell said in a statement Thursday it intends to reorganize so that the combined company will be domiciled in the United States. The combined company will have an enterprise value of about $40 billion.

"Our acquisition of Inphi will fuel Marvell's leadership in the cloud and extend our 5G position over the next decade," said Matt Murphy, Marvell CEO and president. "Inphi's technologies are at the heart of cloud data center networks and they continue to extend their leadership with innovative new products, including 400G data center interconnect optical modules, which leverage their unique silicon photonics and DSP technologies. We believe that Inphi's growing presence with cloud customers will also lead to additional opportunities for Marvell's DPU and ASIC products."

Marvell agreed to pay $66 a share in cash and 2.323 shares of stock for each share of Inphi. The deal values Inphi at roughly $157.83 a share. 

This comes after Advanced Micro Devices' announced a $35 billion acquisition of Xilinx.

You can follow Jim Cramer and Katherine Ross on Twitter at @JimCramer and @byKatherineRoss. Read more from Katherine Ross here.

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