(By Balachander) International Business Machines Corp. (NYSE:IBM) is acquiring recruitment services company Kenexa Corp. (NYSE:KNXA) for around $1.3 billion or $46 a share in cash to strengthen its social business software offerings.
Kenexa shares, which have been trading in the 52-week range of $13.96 to $45.75, jumped 41.25 percent in early trade on Monday.
The deal represents a premium of 42 percent to KNXA's closing price of $32.39 on Friday.
Wayne, Pennsylvania-based Kenexa earned 27 cents a share on revenue of $88.2 million for the second quarter ended June 30 on a non-GAAP basis.
Kenexa, which employs 2,800 people, offers a combination of Cloud-based technology and consulting services to help clients engage a smarter workforce and gain a competitive advantage in any market.
"The combined strengths of IBM and Kenexa are key differentiators at a time when organizations of all sizes are looking to increase workforce efficiencies and gain more insight from their business information," IBM said.
Forrester Research and IDC expect the market for social enterprise platforms to grow 61 percent and 43 percent, respectively, over the next four years.
IBM expects the deal to be completed in the fourth quarter.
Shares of IBM fell 0.34 percent to $197.09 on Monday.