NEW YORK (TheStreet) -- International Game Technology (IGT) shares are up 9.5% to $16.97 in pre-market trading on Wednesday after entering into a definitive merger agreement with Italian gaming company GTech (GTKYY) for $4.7 billion in cash and stock.
Under the agreement the newly formed company will be organized in the U.K. with IGT shareholders receiving $13.69 in cash, plus 0.1819 shares in the new company for each share of IGT common stock, equal to an aggregate value of $18.25 per IGT share.
The aggregate value of the deal including IGT debt is $6.4 billion.
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TheStreet Ratings team rates INTL GAME TECHNOLOGY as a Hold with a ratings score of C. TheStreet Ratings Team has this to say about their recommendation:
"We rate INTL GAME TECHNOLOGY (IGT) a HOLD. The primary factors that have impacted our 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 reasonable valuation levels and expanding profit margins. However, as a counter to these strengths, we also find weaknesses including deteriorating net income, generally higher debt management risk and weak operating cash flow."
Highlights from the analysis by TheStreet Ratings Team goes as follows: