Hutchinson Technology Inc., the central Minnesota company that started 50 years ago in a chicken coop and became a leading maker of digital storage components, is being purchased by Japanese electronics maker TDK Corp.

In a deal worth $126 million, TDK is paying $3.62 per share for Hutchinson, more than double the $1.75 price that Hutchinson shares closed at on Friday. It will pay up to 38 cents more per share depending Hutchinson's cash situation on a date near the closing of the deal, the companies said on Monday.

Hutchinson shares more than doubled on Monday to close at $3.54. They last traded at that level in early February.

"We are being acquired because we have capabilities such as automation, very precise component technologies for the components that go into suspensions," Rick Penn, chief executive of Hutchinson, told the Star Tribune.

"Those capabilities are really what TDK wants to add," Penn said. "A big part of that is the talent that is required to keep advancing those technologies and to ensure that they run well."

No layoffs were announced with the merger announcement, and the company believes the deal will be positive for the company and its employees. "Our employees will be with a large company with enhanced financial resources and a broad product line and a growing global business," company spokeswoman Connie Pautz said.

The two companies have long been rivals in the digital storage segment of the electronics industry. TDK is most familiar to American consumers as a maker of videotape and audiocassettes, but it does a bigger business in semiconductor components used in products ranging from cars to smartphones.

About one-third of TDK's business is in hard drives and other magnetic applications, the digital descendant of videotape and audiotape operations. That business accounted for about $3 billion in sales for its most recent fiscal year, about 10 times larger than Hutchinson's annual sales.

Overall, customers and suppliers in the industry have been consolidating, and there are now three or four major customers and three or four suppliers to those customers. Hutchinson was facing some big debt payments on the horizon and pairing with a larger player in the industry brings scale and volume back and increases customer confidence, Penn said.

"When you weigh the certainties of what this particular transaction brings against the future outlook, which has some risks and uncertainties, this is the right thing to do for shareholders, and customers and employees," Penn said.

The company's founders rented a chicken coop near Hutchinson, Minn., in 1965 to begin producing an etching machine to make heaters for gyroscopes in rocket guidance systems. The company eventually moved into disk drives and components, ballooning in size during the 1980s and 1990s when personal computers used both removable disks and hard disks to store data.

Annual revenue for Hutchinson peaked at $721.5 million in the fiscal year ended Sept. 24, 2006. The last year it showed an annual profit was when it reported a $7.3 million gain for the year ended Sept. 30, 2007.

More recently, the company has seen its sales and staffing shrink as hard disks lost ground to flash memory for data storage in PCs and other digital devices. In September 2014, the company reported it employed about 2,500 people, down from 3,900 in 2004 and 7,700 in 1999.

The company also announced its full-year results for the fiscal year that ended Sept. 27, 2015. Annual revenue was $252.8 million, down 3.2 percent from the previous year. The company lost $39.1 million, or $1.20 a share, for the year, narrowing its losses from the year-ago period when it lost $40.4 million, or $1.44 per share.

For the fourth quarter, the company reported revenue of $63.4 million, down 9.9 percent from the same quarter last year.

Hutchinson reported a net loss of $9.3 million for the quarter, or 28 cents per share, that included $2.4 million in foreign currency losses. In the year-ago quarter it lost $5.2 million, or 18 cents per share.