What happened

Shares of supercomputer manufacturer Cray (NASDAQ:CRAY) soared on Friday, rising as much as 18.6%. As of 10:50 a.m. EDT, the stock was up 18.2%.

The gain follows news that Hewlett Packard Enterprise (NYSE:HPE) entered into an agreement with Cray to acquire the company in a cash deal.

A blue and orange chart showing a stock price moving higher

Image source: Getty Images.

So what

HPE will acquire Cray in a cash deal valued at $1.3 billion, the two companies announced Friday morning. Cray shareholders will receive $35 per share, which explains the stock's rise to around $35 today.

"Answers to some of society's most pressing challenges are buried in massive amounts of data," said HPE CEO Antonio Neri in a press release. "Only by processing and analyzing this data will we be able to unlock the answers to critical challenges across medicine, climate change, space and more. Cray is a global technology leader in supercomputing and shares our deep commitment to innovation."

Now what

The acquisition will enable HPE to "drive the next generation of high performance computing and play an important part in advancing the way people live and work," said Neri.

The deal will result in both revenue growth opportunities and cost synergies, management said.

The two companies expect the acquisition, which is subject to customary closing conditions and regulatory approval, to close by the first quarter of HPE's fiscal 2020.

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