NEW YORK (TheStreet) -- Shares of Alliant Techsystems Inc. (ATK) are up 6.61% to $148.00 in pre-market trade after it was reported that the ammunition maker will merge with Orbital Sciences Corp. (ORB), after spinning off its sporting gun business, Reuters reports.
Shares of Orbital Sciences are surging, up 20.32% to $31.97 in pre-market trade.
Orbital stockholders will get 0.449 ATK shares per Orbital share, according to ATK.
The combined company, to be called Orbital ATK Inc, will own about $1.7 billion of ATK's debt, Reuters noted.
ATK said its shareholders will own about 53.8% of the combined company, and Orbital shareholders will hold the rest.
The deal is expected to close by year's end.
TheStreet Ratings team rates ALLIANT TECHSYSTEMS INC as a Buy with a ratings score of A-. TheStreet Ratings Team has this to say about their recommendation:
"We rate ALLIANT TECHSYSTEMS INC (ATK) a BUY. This is based on the convergence of positive investment measures, which should help this stock outperform the majority of stocks that we rate. The company's strengths can be seen in multiple areas, such as its revenue growth, solid stock price performance, impressive record of earnings per share growth, compelling growth in net income and attractive valuation levels. We feel these strengths outweigh the fact that the company has had generally high debt management risk by most measures that we evaluated."