NEW YORK (TheStreet) -- Hill-Rom Holdings (HRC) - Get Report shares up 8.8% to $56.99 in early market trading on Wednesday after the medical technology company said that it will acquire privately held Welch Allyn for about $2.05 billion.

Welch Allyn shareholders will receive $1.625 billion in cash and about 8.1 million in newly-issued Hill-Rom stock.

Welch Allyn shareholders are a group of about 75 individuals and will own approximately 13% of the newly formed company once the deal closes before the end of September.

Hill-Rom makes a variety of hospital and long term care beds. Welch Allyn specializes in medical diagnostic equipment.

"This is a significant step in our transformational journey, and we are confident that our combination with Welch Allyn advances these objectives and will create a stronger platform from which to deliver significant value creation for our shareholders and other stakeholders," said CEO John J. Greisch.

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