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Cramer: Why Ascena needed to buy Ann

CNBC's Jim Cramer said Monday that Ascena Retail Group needed to buy Ann Inc. "because they've got to revitalize."

"This is a very high-end play that they have lacked," Cramer said on "Squawk on the Street." "This was a very good acquisition for [Ascena CEO] David Jaffe."

Cramer made his remarks after Ascena announced it will acquire Ann for $47 per share in cash and stock. News of the deal sent both companies' stocks soaring, with Ascena shares rising about 3.5 percent in early trading Monday and Ann surging more than 20 percent.

The deal is expected to be finalized in the second half of this year and will be financed through bank debt.

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"This powerful transaction joins two strong and highly complementary organizations and management teams and dramatically reinforces our leadership position in women's specialty apparel retailing," Jaffe said in a release.

Ann is the parent company of Ann Taylor, Loft Ann Taylor Factory and Loft Outlet retailers.

DISCLOSURE: Cramer's trust does not own Ascena or Ann stock.