[Digital Today reporter Chi-gyu Hwang (황치규)] U.S. data centre connectivity solutions company Credo Technology Group will acquire Israeli silicon photonics chip company DustPhotonics, Israeli local media outlet Calcalist reported on April 14 local time.

Credo will acquire DustPhotonics by paying $750 million in cash and $123 million worth of stock.

Credo's strategy is to accelerate the expansion of its business in optical communications through the acquisition.

Silicon photonics is a technology that uses light to transmit data much faster and with less power than electrical signals. DustPhotonics has developed silicon photonics technology that integrates optical functions on a single chip.

Credo plans to reduce its reliance on external suppliers through the acquisition and build an integrated connectivity platform across AI systems.

Silicon photonics has recently emerged as a key component for AI data centres and has drawn attention from investors. Nvidia CEO Jensen Huang (젠슨 황) also cited photonics as a core pillar of AI infrastructure at the company's annual GTC conference in March. Calcalist said Nvidia's strategic investments in Lumentum and Coherent also fuelled gains in related sector share prices.