User blog comment:B214/Chapter 487 review/@comment-25572451-20160530203030/@comment-7418318-20160530204005

Could be a number of things.

He might have stored Serena's (living or dead?) body in a magical storage space via re-quip (or some equivalent) magic.

He might have extracted the DS Lacrima and either carries them or maybe even implanted them in himself.

Or he might have somehow merged together with him or absorbed him. There was this odd sound-effect and pattern on his hand when he said that line.