NEW YORK (TheStreet) -- Shares of PetSmart (PETM) are surging, higher by 4.87% to $81.45 in pre-market trading Monday, after the specialty pet products chain agreed to be acquired by a consortium led by London-based private equity firm BC Partners for $8.7 billion, or $83 per share in cash.
The $83 per share BC Partners will pay represents a 6.86% premium over PetSmart's closing price on Friday.
In July, activist investor Jana Partners started to push for a sale of the company after disclosing a 9.9% stake. Jana paid less than $55 per share for its percent stake, according to regulatory filings, CNBC reports.
Phoenix-based PetSmart, which operates about 1,387 pet stores in the U.S., Canada and Puerto Rico, said in August that it would explore a potential sale of the company.
Separately, TheStreet Ratings team rates PETSMART INC as a Buy with a ratings score of A-. TheStreet Ratings Team has this to say about their recommendation:
"We rate PETSMART INC (PETM) 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, reasonable valuation levels, good cash flow from operations, growth in earnings per share and increase in stock price during the past year. We feel these strengths outweigh the fact that the company has had sub par growth in net income."