WALTHAM, Mass. (AP) — Raytheon Co. said Monday it has agreed to acquire Applied Signal Technology Inc., which makes intelligence and surveillance systems, for about $490 million in cash.
The purchase price works out to $38 per share. That's a 9 percent premium to Applied Signal's closing price on Friday and 37 percent higher than its stock price in late October when the Sunnyvale, Calif., company first announced plans to explore strategic options.
Applied Signal stock jumped $2.83 or 8.1 percent to $37.85 in premarket trading.
The deal is expected to close in the first three months of next year. It has been approved by both companies' boards.
The transaction isn't expected to have a significant effect on Raytheon's earnings.