By midafternoon, shares had surged 31.5% to $37.20. Trading volume of 672K was more than seven times its three-month daily average.
The social services provider said it had entered into an agreement to purchase Australia-based Ingeus, a company specializing in which provides assistance to the unemployed.
"The acquisition expands Providence's footprint into new markets, diversifies its customer base, and enhances its workforce development expertise," Providence said in a statement.
The Tuscon, Arizona-based will purchase 100% of Ingeus for 35 million British pounds in cash or stock (or $58 million based on the exchange rate at March 27).
The transaction is expected to close in the second quarter of 2014, subject to regulatory approval, and is forecast to be accretive to earnings in the current fiscal year.
"Ingeus complements our existing businesses, both strategically and culturally, and shares our core values, focus on integrity, and commitment to customer-centered care through innovation," said Providence CEO Warren Rustand in a statement. "Importantly, because there is no overlap of current clients, there will be significant opportunity for sharing of expertise."
Ingeus' founder Therese Rein will continue in her role as chief executive, reporting directly to Rustand.
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TheStreet Ratings team rates PROVIDENCE SERVICE CORP as a Buy with a ratings score of B-. TheStreet Ratings Team has this to say about their recommendation: