Credo to buy Israeli chipmaker DustPhotonics in cash-and-stock deal worth up to $1.3B

The deal

US-based Credo, a player in data-center connectivity, has agreed to acquire Israeli chip company DustPhotonics in a cash-and-stock transaction. It has been reported that the consideration could reach as much as $1.3 billion. The structure mixes immediate cash with equity, signaling both a payoff and a bet on future combined value.

The companies

Credo sells networking silicon and modules used inside hyperscale data centers; DustPhotonics is best known for optical transceiver and photonics chips that help move massive amounts of data. Together, the pair would stitch electrical and optical domains more tightly — think of it as one supplier trying to own more of the highway, not just the cars. Observers say the deal would give Credo broader access to optical interconnect technology and a stronger footing with cloud and enterprise customers.

Why it matters

Why now? Bandwidth demand isn’t waiting around. AI training, video, and cloud services keep pushing the limits of how quickly data must travel. This is consolidation with a purpose — scale, integration, cost control. The move also highlights an ongoing trend: networking companies snapping up photonics specialists to chase the next wave of data-center performance. Regulatory sign-offs and the usual closing conditions will apply; until then, it’s a high-stakes handshake and a clear signal that optics matter more than ever.

Sources: calcalistech.com