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What: Shares of U.S. construction equipment parts maker Cascade (NYS: CASC) soared 18% today after Japanese counterpart Toyota Industries, a sister company of automaker Toyota Motor (NYS: TM) , offered to buy it for $759 million.
So what: The all-cash deal values Cascade at $65 per share and represents an 18% premium to its Friday closing price. Slowing demand from China and volatile currency movements have pressured Cascade's earnings in recent quarters, but it's obvious that Toyota is taking advantage of the weakness to expand its lift truck business globally.
Now what: The deal is expected to close by the end of year, at which point Cascade President and Chief Executive Robert Warren Jr. will continue head up operations. "Our company has concluded that the offer being made by Toyota Industries Corporation, one of the world's most admired companies, represents an ideal combination of attractive return to our shareholders, continuing service to our customers, and stability and opportunity for our employees," Warren said . Of course, with Cascade shares now all popped out, Fools might want to look into close rival Nacco Industries (NYS: NC) as the next bargain opportunity in the space.
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The article Why Cascade Shares Surged originally appeared on Fool.com.
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