Aesthetic laser device maker Syneron Medical Ltd said it agreed to buy rival Candela Corp in an all-stock deal valued at about $65 million.

Under the agreement, Candela shareholders will receive 0.2911 shares of Syneron for each Candela share they own, representing a premium of about 51 percent to the closing price of Candela's shares on Tuesday. At the close of the transaction, which is expected by year-end 2009, Syneron shareholders will own about 80 percent of the combined company. Both companies have dramatically reduced operating expenses, which positions the combined company, post integration, to be profitable and the transaction to be accretive to our earnings as market conditions normalize, Syneron Chief Financial Officer Fabian Tenenbaum said.

Syneron's Louis Scafuri will remain chief executive officer of the combined company and Shimon Eckhouse will remain chairman of the board of directors. Candela CEO Gerard Puorro will join Syneron's board.

Shares of Israel-based Syneron closed at $9.74 Tuesday on Nasdaq, while Candela's shares closed at $1.88. (Reporting by Brenton Cordeiro in Bangalore; Editing by Aradhana Aravindan)