NEW YORK (TheStreet) -- Shares of ADT Corp. (ADT) - Get Report are surging by 52.21% to $40.90 in pre-market trading on Tuesday, after the company agreed to be bought by funds affiliated with private equity firm Apollo Global Management (APO) for $7 billion, Reuters reports.

Apollo will pay $42 per share in cash for ADT, a premium of about 56% over ADT's closing stock price on Friday.

Once the transaction closes, ADT will merge with Apollo's home and business security company Protection 1.

The combined company will be based in Boca Raton, FL and will have a proforma annual revenue of more than $4.2 billion.

"This transaction represents a highly attractive premium for ADT's shareholders," ADT CEO Naren Gursahaney said in a statement this morning. "We're proud to have strengthened the quality of our customer base, improved service and retention, and extended our leadership in innovative solutions."

ADT is a Boca Raton, FL-based provider of monitored security, interactive home and business automation and related monitoring services in the U.S. and Canada.

Shares of Apollo are down by 4.85% to $12.75 in pre-market trading on Tuesday.

Separately, TheStreet Ratings Team has a Hold with a score of C+ on the stock.

The primary factors that have impacted the rating are mixed - some indicating strength, some showing weaknesses, with little evidence to justify the expectation of either a positive or negative performance for this stock relative to most other stocks.

The company's strengths can be seen in multiple areas, such as its revenue growth, reasonable valuation levels and good cash flow from operations.

As a counter to these strengths, the team also finds weaknesses including deteriorating net income, generally higher debt management risk and a generally disappointing performance in the stock itself.

Recently, TheStreet Ratings objectively rated this stock according to its "risk-adjusted" total return prospect over a 12-month investment horizon. Not based on the news in any given day, the rating may differ from Jim Cramer's view or that of this articles's author.

You can view the full analysis from the report here: ADT

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