Ceragon Networks Ltd. climbed to the highest level in more than three years after the wireless networking-systems developer entered into an agreement to buy all the outstanding shares of Nera Networks from Eltek ASA.
The stock surged 6 percent to 51.32 shekels, the highest level since December 2007, giving the company a market value of 1.72 billion shekels ($471 million).
Ceragon, based in Tel Aviv, said it will pay about $48.5 million for Nera on a cash-free, debt-free basis.
“Year 2011 is expected to be a transition year with no immediate profitability,” Chief Executive Officer Ira Palti told reporters today. With the merger, “we expect to produce more profitability than we would have produced ourselves by 2012.”