Infinera ( INFN ) shares are trading higher Friday following an announcement by Nokia ( NOK ) that it will acquire the company.

What Happened: Nokia ( NOK ) is set to purchase Infinera ( INFN ) at $6.65 per share, totaling to $2.23 billion. This share price represents a premium of 28% to Infinera’s share price on Wednesday at market close.

Infinera ( INFN ) shareholders can choose to receive either $6.65 in cash, 1.78 Nokia ( NOK ) shares, or $4.66 in cash and 0.53 Nokia ( NOK ) shares, per Infinera ( INFN ) share.

Nokia ( NOK ) stated the acquisition of Infinera ( INFN ) strengthens the company’s optical networking market position, particularly in North America, while advancing its strategy to diversify its customer base and enhance its webscale presence.

In addition, the transaction targets EUR 200 million in synergies by 2027 and it is expected to boost both Nokia’s operating profit and EPS from year one.

“The combined businesses have a strong strategic fit given their highly complementary customer, geographic and technology profiles. With the opportunity to deliver over 10% comparable EPS accretion, we believe this will create significant value for shareholders,” said Pekka Lundmark, president and CEO of Nokia ( NOK ).

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INFN Price Action: At the time of publication, Infinera ( INFN ) shares are trading 16.9% higher at %6.15, according to data from Benzinga Pro.

Image: Courtesy of Infinera ( INFN )