QLogic (QLGC) , a maker of high-speed electronic components, said on Monday that it had agreed to acquire Ancor Communications (ANCR) , a developer of fiber switches, in a stock deal valued at $1.7 billion.
Under the terms of the deal, QLogic will exchange 0.5275 shares of common stock for each share of Ancor common stock. QLogic closed at $99.9375 on Friday.
The deal values each Ancor share at $52.72, a 59% premium over its Friday closing price of 31 3/16.
Ancor surged to 46 in pre-opening trading on Monday in thin activity, according to
. QLogic did not trade.
The transaction is expected to be neutral to slightly accretive to QLogic's earnings for the year ending December 2001, and accretive to earnings in the fiscal year ending March 2002.
Upon the closing of the acquisition Ancor's CEO, Ken Hendrickson, will be nominated to QLogic's board.
QLogic of Aliso Viejo, Calif., said the transaction is intended to qualify as a pooling of interests and as a tax-free exchange of shares under
The deal is subject to shareholder and regulatory approvals. It is expected to close in the third quarter.
SG Cowen Securities
was the financial advisor to QLogic for the transaction.
represented Ancor, which is based in Eden Prairie, Minn.