What happened

Shares of Cavium Inc. (NASDAQ:CAVM) jumped on Thursday after Marvell Technology Group's (NASDAQ:MRVL) acquisition of the company was approved by Chinese regulators. Marvell now expects the deal to close in July. Cavium stock ended the session up 9.8% while Marvell stock gained 8.2%.

So what

Cavium agreed to be acquired by Marvell in November of last year. The transaction was valued at roughly $6 billion, with Marvell paying $40 in cash and 2.1857 Marvell shares for each share of Cavium. That worked out to a purchase price of $80 per share at the time.

A drawing of a big fish eating a little fish on a notepad page.

Image source: Getty Images.

With tense trade relations between the U.S. and China, the approval from China's State Administration for Market Regulation ends any concerns that this deal would be shut down by regulators. Marvell expects to realize between $150 million and $175 million in annual run-rate synergies within 18 months of closing, and the deal is expected to be accretive to revenue growth, margins, and non-GAAP EPS.

Now what

The combined company will have annual revenue in the ballpark of $3.4 billion, with a presence in hard disk drive and solid-state drive controllers, networking solutions, wireless connectivity products, multicore processors, storage connectivity products, and security solutions. When the deal was announced, Marvell estimated that the acquisition would bring its total addressable market up to $16 billion.

With the last big hurdle out of the way, this acquisition looks like a done deal.