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NEW YORK (TheStreet) --Shares of Checkpoint Systems (CKP) are jumping by 28.91% to $10.17 on heavy trading volume on Wednesday afternoon, as the stock continues to gain after it was announced that the antitheft tag maker is being acquired by Canada's CCL Industries.

The U.S.-based company will be purchased for about $422 million or $10.15 per share. This offer represents a 29% premium to Checkpoint Systems' closing price on Tuesday.

"We have admired Checkpoint for many years as they built a unique, leading global position providing technology driven label solutions to the retail and apparel industry," CCL CEO Geoffrey T. Martin said in a statement.

The deal is expected to close in the middle of this year and is to be funded by CCL with its existing $1.2 billion debt.

Additionally, shareholder rights law firm Johnson & Weaver has launched an investigation into whether Checkpoint board members breached their fiduciary duties in regards to the proposed merger with CCL.

"The investigation concerns whether the Checkpoint board failed to satisfy their duties to the Company shareholders, including whether the board adequately pursued alternatives to the acquisition and whether the board obtained the best price possible for Checkpoint shares of common stock," the firm said.

Separately, TheStreet Ratings has set a "sell" rating and a score of D+ on Checkpoint Systems stock. This is driven by some concerns, which TheStreet Ratings believes should have a greater impact than any strengths, and could make it more difficult for investors to achieve positive results compared to most of the stocks it covers.

The company's weaknesses can be seen in multiple areas, such as its disappointing return on equity, weak operating cash flow and generally disappointing historical performance in the stock itself. 

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: CKP

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