Why Is Varex Imaging (VREX) Stock Up? Teledyne Is Buying It for $18.90 a Share

TL;DR

• Varex Imaging (VREX) jumped roughly 48% to about $18.40 in premarket trading on Monday, August 10, after Teledyne Technologies agreed to buy it for $18.90 a share in cash.
• The deal is worth about $1.1 billion, including Varex's equity awards and net debt, and represents a 52.3% premium to Friday's $12.41 close.
• Both boards approved the deal unanimously. It's expected to close in early 2027, subject to regulatory and Varex shareholder approval.
• Varex makes X-ray tubes and digital detectors for medical and industrial imaging. Teledyne is buying a supplier that fills a gap in its own CMOS-detector and magnetron lineup, with minimal product overlap.
• The stock traded a few percent below the offer even in the first minutes, the normal shape of a cash deal with more than a year left before closing.

Why Is Varex Imaging Stock Up Today?

Teledyne Technologies agreed to acquire Varex Imaging for $18.90 a share in cash, and VREX gapped up about 48% to roughly $18.40 in premarket trading. Friday's close was $12.41. A buyer named a fixed price well above that, and the stock moved almost the entire distance in a single session, which is exactly what a cash takeover is supposed to do to a target's price.

Even at the premarket print, the stock sat about $0.50 below the $18.90 offer, roughly a 2.7% gap. That's a normal early spread: the deal isn't closing tomorrow, so the market prices in the wait and the (small) chance something goes wrong between now and completion.

The Math Behind the Premium

$18.90 against a $12.41 Friday close is a 52.3% premium. Run it the other way: $12.41 x 1.523 comes out to $18.90, so the number holds up under its own arithmetic, which is the first thing worth checking on any acquisition premium before repeating it.

The total transaction is valued at approximately $1.1 billion, a figure Teledyne's release says accounts for Varex's outstanding equity awards and net debt as of April 3, 2026, not just the per-share price times the plain share count. That distinction matters: a headline deal value built from share count alone would understate what Teledyne is actually paying, and the company was specific about what's included.

Why Teledyne Wants an X-Ray Detector Maker

Varex has spent decades building X-ray sources and digital X-ray detectors, plus high-voltage interconnects and imaging software, sold mostly to the OEMs that build medical scanners and industrial inspection systems. Teledyne already makes CMOS-based imaging sensors and magnetron components; buying Varex adds the detector and X-ray-tube side of the imaging stack with, according to the companies, minimal overlap between the two product lines.

That's a classic "buy the adjacent piece" industrial deal: Teledyne isn't eliminating a competitor, it's filling a gap so it can sell more of the imaging chain to the same OEM customers. Varex CEO Sunny Sanyal called it a deal delivering shareholders a "substantial premium," which, at 52%, is not an exaggeration.

What the Spread Says About Deal Risk

A roughly 2.7% gap between the premarket print and the $18.90 offer, this early in a deal expected to close in early 2027, is unremarkable. Annualize that spread over the time to close and it looks like a modest, bond-like return for whoever holds the stock purely for the arb, which is the entire logic of merger arbitrage: it isn't a bet on the business, it's a bet on the deal closing on schedule.

The real risk isn't the wait, it's the deal breaking. Both boards approved unanimously and the release doesn't flag a financing contingency as a concern, which points toward a clean path, but regulatory review and a shareholder vote both still have to happen over roughly six months. If either stalls or fails, VREX has further to fall back toward its pre-deal price than it has left to gain by holding to $18.90. That asymmetry is the whole reason the spread exists at all.

The Options Angle

• Once a fixed cash price is on the table, options on the target typically go quiet fast: the range of realistic outcomes narrows to "closes near $18.90" or "breaks and falls back toward the low teens," and implied volatility compresses accordingly.
• A live, liquid VREX options quote could not be sourced at the time of writing. Rather than invent a price, that's logged as a pass.
• The only trade with real edge here is a bet on a competing bid emerging, and nothing in the public record suggests one is coming. That makes it speculation on an event, not an options thesis grounded in anything disclosed.

Trade log

#	Stance	Structure	Strikes and expiry	Cost or credit	Spot at writing	Implied move	Breakeven
1	Pass	Options (calls or puts)	n/a	Liquid VREX chain not sourced	~$18.40 premarket vs $18.90 deal price	Not sourced	n/a, declined for lack of a priceable market and lack of upside beyond the fixed offer

The One-Line Read

Varex Imaging is up about 48% because Teledyne is paying $18.90 a share, cash, for a company that closed Friday at $12.41, a 52% premium for the X-ray detector maker that fills a real gap in Teledyne's imaging lineup, and the small spread still on the table is the market's honest price for a roughly six-month wait through regulatory review, not a hint that the deal is in doubt.