A deal that launched with a 24% premium has since turned into a double-digit loss for shareholders on both sides of the Marvell Technology (NASDAQ: MRVL) and Lumentum Holdings (NASDAQ: LITE) transaction.
That rapid reversal is now the centerpiece of a fresh warning from Gary Black, co-founder of The Future Fund LLC, directed squarely at investors betting on an all-stock Tesla and SpaceX merger.
Black took to the social media platform X on November 4 to challenge the optimism surrounding a potential deal between Elon Musk’s two flagship enterprises.
“$TSLA bulls still hanging onto the hope that $SPCX will buy $TSLA in an all-stock deal,” he wrote, invoking the Marvell-Lumentum collapse as a live case study in merger risk.
The numbers behind his argument are stark: since the MRVL-LITE deal was announced, Lumentum shares have dropped 27% while Marvell has fallen 31%.
“A +24% premium can quickly go negative as the acquirer’s stock is sold down,” Black warned, underscoring how all-stock deals expose target shareholders to acquirer volatility.
Black has raised dilution concerns for Tesla (NASDAQ: TSLA) shareholders throughout this debate, noting that SpaceX could theoretically offer $420 per share but that the structure of such a deal carries serious risks.
Merger speculation gained momentum following SpaceX’s third-quarter earnings call and the high-profile debut of Tesla’s new Roadster, which used SpaceX-sourced thrusters to make the vehicle hover.
Not everyone frames the potential deal as a threat to Tesla investors, however, with prominent analyst Scott Galloway offering a sharply different perspective on where the damage would fall.
Galloway argued that while a merger could strengthen Tesla’s financial position, it would come at the expense of SpaceX shareholders, describing Tesla as a “patient” and SpaceX as an “organ donor.”
The dueling warnings reflect growing tension among investors as merger chatter intensifies, with TSLA shares up 4.57% and SPCX gaining 9.72% at the time of reporting.
Black’s broader message is that the excitement surrounding a potential deal may be obscuring real structural dangers that all-stock transactions routinely produce once markets begin to reprice the acquirer.
