Investors are applauding a deal announced Monday afternoon between two makers of tools. Stanley Works (SWK) will acquire Black & Decker (BDK) in an all stock deal according to DealBook. While the agreement called for Black & Decker to be acquired for $4.5 billion in Stanley stock at the time the market closed Monday, the price of the deal is rising because Wall Street loves it so much.
How so? The deal is a stock swap which means that Stanley will exchange 1.275 shares of its stock for each share of Black & Decker. That was a 22 percent premium over Friday's market close. Since the deal was announced, however, the stock of Black & Decker surged over 20 percent, to $57.10. And in a really unusual happening, even Stanley's shares rose 4 percent, to $47. That gain means that Black & Decker shares are worth even more, according to DealBook.