Luna Innovations Incorporated (NASDAQ: LUNA) has announced the two major deals. In one deal, the company has divested its Luna Labs division in a transaction worth around $21 million. In another deal, the company has bought LIOS Sensing (LIOS) which is a division of NKT Photonics, an NKT A/S company (NASDAQ: NKT.CO), for €20 million in cash. Shares of Luna surged 6% at the time of writing on Monday.

The sale of Luna Labs completes the company's portfolio streamlining, which began several years ago when it revealed its goal to focus its resources and money on the fiber optics industries. While not the key to Luna's fiber optic-based innovations, the company is extremely proud of the important work the Luna Labs team has done over the years and looks forward to their ongoing success under the new company's leadership.

The acquisition of LIOS, on the other hand, is a significant step forward for Luna. It is combining two complementing businesses that will help it continue on its upward trajectory. By combining LIOS' world-leading position in temperature and strain sensing with Luna's wide fiber optic products, the company will be able to take advantage of major technological improvements as well as expanded market potential.

Furthermore, Luna is now a pure-play fiber optic-based technology company, and it is exciting to use its industry-leading, patented fiber optics platform to better serve its clients and achieve long-term growth for its investors and workers following the divestment of Luna Lab.

The acquisition of LIOS Sensing is expected to provide Luna with long-range, completely distributed temperature and strain sensing capability, intellectual property, products, and experience that will enhance Luna's offerings. It will bring a varied, blue-chip customer base with it, creating a major cross-selling opportunity. Luna further believes that this acquisition will increase Luna's intellectual property portfolio to around 800 active and pending patents.