Toro will pay $700 million to acquire the Charles Machine Works and its well-known Ditch Witch brand, expanding into the underground utility market and helping to smooth out the seasonal aspects of the maintenance equipment business.

The Bloomington-based company will take on new debt to fund the all-cash transaction, which is expected to close this summer.

The deal is Toro's largest acquisition, beating its $227 million purchase in 2014 of the Boss line of professional snow equipment.

Toro shares rose nearly 3 percent on the news Friday, outpacing a strong rally in the broader market.

Privately held Charles Machine Works makes a wide range of products, from drills and ride trenchers to utility loaders for the underground pipe and cable market. The Oklahoma company had revenue of $725 million last year.

"The addition of Charles Machine Works will further strengthen our portfolio of market-leading brands supported by talented employees, a commitment to innovation, a best-in-class dealer network and long-standing customer relationships," Richard Olson, Toro's chief executive, said in a statement.

He said Charles Machine's navigation, 3-D imaging and other technology will be beneficial to all of Toro's manufacturing.

It will expand business in an adjacent category that fits well with Toro's specialty construction business.

And it comes at a time, he said, when the market is "attractive given the potential for growth in addressing both aging infrastructure that is currently in place and new infrastructure that will be needed to support next generation technologies like 5G."

Rick Johnson, CEO of Charles Machine Works, said his company is well-positioned to fit into the Toro network culturally.

Charles Machine has been a family-owned company since it was founded in the early 1900s and has the same approach toward employees and performance expectations, Olson said.

The company is "less subject to weather and seasonality" than the current core of Toro's business, maintenance equipment.

He also said Toro expects to receive $30 million in cost savings by integrating the two businesses.