Allied Capital Jumps on Volume Surge

NEW YORK (TheStreet) -- Allied Capital (ALD Quote) shares surged Monday on a spike in volume after news it would be purchased by Ares Capital (ARCC Quote).

Allied Capital said it will be acquired for $648 million, or $3.47 a share, in an all-stock transaction. The deal represents a 27.3% premium to Allied Capital's closing stock price on Monday. Allied Capital stockholders will receive 0.325 Ares Capital shares for each Allied share, the investment company said.

Shares of Allied Capital were climbing by 93 cents, or 34.1%, to $3.66, above Ares Capital's bid price. Earlier in the session, the stock touched an intraday high of $3.76. More than 16.4 million shares changed hands by 2:30 p.m. EDT Friday, compared to the stock's three-month average daily volume of 1.5 million, according to Yahoo! Finance.

Allied Capital has a 174.3 million-share float with a short interest float of 4.4% as of Sept. 25, according to Yahoo! Finance. Insiders hold only 1.9% of the company's shares with another 27.9% owned by institutions.

-- Written by Robert Holmes in New York.

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