BlackBerry Limited (BB) stock rallied 18.59% during the pre-market trading session on Monday, following the announcement that the company has entered into a definitive agreement to sell its Cylance endpoint security assets to Arctic Wolf for $160 million in cash and stock.

Under the terms of the deal, Arctic Wolf, a leader in AI-powered security operations, will acquire Cylance's suite of AI-based endpoint protection capabilities by paying BlackBerry $160 million, comprising $80 million in cash at closing, $40 million in cash one year after closing, and approximately 5.5 million common shares of Arctic Wolf.

The acquisition allows Arctic Wolf to enhance its Security Operations Aurora Platform with Cylance's industry-leading endpoint prevention, detection, and response solutions, thereby expanding its offerings and market reach. For BlackBerry, the transaction enables the company to sharpen its focus on its core Secure Communications portfolio, including BlackBerry UEM, BlackBerry AtHoc, and BlackBerry SecuSUITE, while also benefiting as a reseller of the Cylance portfolio to its government customers and as a shareholder in the combined Arctic Wolf-Cylance entity.