TESSCO Technologies (NASDAQ:TESS) has inked a merger agreement with the owners of Alliance Corporation and GetWireless, to create “a leading value-added telecommunications distributor in North America”.
The deal between TESSCO, Lee Equity Partners and Twin Point Capital values the listed firm at around US$161.4 million, with shareholders due US$9 per share in cash.
It represents a 91% premium to TESSCO’s share price prior to the deal news, and, the deal comes recommended by the company’s board.
The merger is expected to close in the third quarter of 2023, subject to shareholder approval.
"The transaction price and premium reflect the success of our considerable turnaround efforts over the past three years, as well as TESSCO's current growth trajectory,” TESSCO chief executive Sandip Mukerjee said in a statement.
The company will maintain its facilities in Hunt Valley and Timonium, Maryland, and Reno, Nevada, whilst adding to its footprint and product offering through collaboration with Alliance and GetWireless.
In New York, TESSCO stock shot up more than 85%, or US$4.08, to trade at US$8.79 per share.