What happened?

Shares of PCM (NASDAQ:PCMI), a leading provider of technology solutions, hardware, software, and services, are up 42% Monday morning after it was announced the company would be acquired by Insight Enterprises (NASDAQ:NSIT).

So what

Insight Enterprises and PCM have entered into an agreement in which the former will acquire the latter for $35 per share, a transaction valued at $581 million including cash and debt acquired. "This combination offers the ability to provide clients with greater value through the expansive solution offerings of the combined company at a time when customers increasingly need a full-service technology solutions provider to help them transform for the future," said Frank Khulusi, chairman and CEO of PCM, in a press release.

A business meeting.

Image source: Getty Images.

Now what

The acquisition makes sense for Insight Enterprises, as it brings in more technical and sales resources, as well as access to thousands of new clients. The move will also improve Insight's ability to provide solutions for clients at a time when they're positioning their businesses for rapid growth. Acquiring PCM will also accelerate growth in Insight's solutions business, which includes supply chain optimization, connected workforce, cloud and data center transformation, and digital innovation. Management believes it can generate cost synergies of roughly $70 million annually by the end of 2021 and that the acquisition will add $0.70 in adjusted earnings per share in 2020, excluding transaction-related costs and restructuring expenses.