Avnet

(AVT) - Get Report

agreed to acquire

Kent Electronics

(KNT)

for about $550 million in stock in a merger of two electronic products distributors.

Avnet will swap 0.87 shares for each share of Kent. About $50 million of the total transaction consists of cash currently on Kent's books in excess of assumed debt. The companies expect to close the deal within 90 days.

Shares of Kent gained $1.08, or 6.8%, to $16.98 in recent

New York Stock Exchange

trading, while Avnet lost $3.30, or 14%, to $20.25.

Kent's electronics components operation will be combined with Avnet's domestic distribution unit. The division will be headquartered in Phoenix, Avnet's home base. Kent is located in Sugar Land, Texas.

Both companies also issued guidance as part of Thursday's announcement. Avnet said earnings in the third fiscal quarter would be between 60 cents and 65 cents a share. The current consensus estimate by six analysts polled by

First Call/Thomson Financial

is 73 cents. The company earned 56 cents a share in the year-ago period. The company forecast revenue of $3.2 billion, short of the $3.4 billion consensus estimate. In the year-ago quarter, sales totaled $2.7 billion.

Kent's should report fourth-quarter earnings of 30 cents to 33 cents a share, while the consensus estimate calls for a profit of 35 cents. The company earned 25 cents a share in the year-ago quarter. Revenue is expected to be between $230 million and $240 million in the quarter.