Optical components supplier Lumera Corp. [LMRA] announced plans to merge with privately held high-speed communications chip developer GigOptix Inc. in a transaction valued at more than $40 million. The new company will retain GigOptix's name and chief executive, and will be publicly traded. Lumera will divest itself of its life sciences business, Plexera Bioscience LLC, to focus on optics.

Real estate holding company DBSI Inc., which invested an undisclosed amount in GigOptix last September, will be the combined company's largest stakeholder. (DBSI's high-tech venture arm, Stellar Technologies, invested as well.) Silicon Valley Bank also provided capital to GigOptix last year, although it was not immediately clear whether it provided debt or equity to the company.

To complete the current transaction, Lumera will issue about 20 million new shares, bringing the total number of shares outstanding to about 40 million. Lumera shares closed Thursday at $2.07 apiece, giving the company a market capitalization of about $41.6 million. The combined entity expects roughly $6 million revenues during the first half of 2008.

Lumera retained investment bank GCA Savvian Advisors LLC  for advice on the deal. The transaction is expected close just after midyear. -- Paul Bonanos

See March 27 press release from Lumera
See September 2007 press release from GigOptix