Ruckus' Stock Soars After Brocade Buyout Deal

Shares of Ruckus Wireless Inc. soared 35% in premarket trade Monday, after the wireless services company agreed to be acquired by Brocade Communications Systems Inc. in a stock and cash deal that values Ruckus at about $1.5 billion. Under terms of the deal, Ruckus shareholders will receive 0.75 Brocade shares and $6.45 in cash for each Ruckus stock they own. Based on Friday's closing prices, that values Ruckus shares at $14.43 each, or a 44% premium. Brocade said it expects the deal, which is seen closing in its fiscal third quarter of 2016, to add to adjusted earnings by the first quarter of fiscal 2017. Brocade's stock dropped 6% ahead of the open. Separately, Brocade said it increased its stock repurchase program by $800 million, to a total of $1.7 billion.