Alere Inc. (NYSE: ALR) absolutely skyrocketed in Monday’s regular session following the announcement that it will be acquired by Abbott Laboratories (NYSE: ABT). At this point, the companies have only entered into a definitive agreement; customary and regulatory conditions still apply if the transaction is to close.

Under the terms of the agreement, Abbott will acquire Alere for a total of $56 per share, putting the total value of the offering at $5.8 billion, or a 50.5% premium from Friday’s closing price ($37.20).

Consensus estimates call for Alere’s revenues in 2016 to total $2.5 billion. Over the past 52 weeks, the stock is down over 8%, which is more or less in line with the broad markets.

Upon completion of the transaction, the combined business will offer the broadest point of care menu of infectious disease, molecular, cardiometabolic and toxicology testing.

Once the transaction is completed, Abbott will become the leading diagnostics provider of point of care testing. Abbott’s total diagnostics sales will exceed $7 billion after the close.

Miles D. White, chairman and CEO of Abbott, commented:

The combination of Alere and Abbott will create the world’s premier point of care testing business and significantly strengthen and grow Abbott’s diagnostics presence. We want to offer our customers the best and broadest diagnostics solutions. Alere helps us do that.

Namal Nawana, president and CEO of Alere, added:

Today’s announcement marks an exciting and transformative milestone for Alere and one that provides an immediate benefit for our stockholders. Our leading platforms and global presence in point-of-care diagnostics, combined with Abbott’s broad portfolio of market-leading products, will accelerate our shared goal of improving patient care. I’d like to thank our global workforce of nearly 10,000 employees whose hard work and dedication has enabled Alere to contribute to improved patient outcomes throughout the world.

Shares of Alere were last seen trading up 45% at $53.96 on Monday, with a consensus analyst price target of $53.00 and a 52-week trading range of $31.96 to $55.99.

Shares of Abbott were down 1.6% at $37.24, within a 52-week range of $36.00 to $51.74. The consensus price target is $44.71.

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