Beacon Roofing Supply has agreed to an $11 billion buyout offer from billionaire Brad Jacobs’ firm QXO, weeks after it rejected a marginally lower bid from the company and raised its defenses to prevent a hostile takeover.
The deal caps a months-long takeover saga and gives QXO, a new entrant in the building products distribution industry, a solid advantage with Beacon’s expansive network of branches across the U.S. and Canada.
“Acquiring Beacon is a key milestone in our plan to create substantial shareholder value and establish QXO as a leader in the $800 billion building products distribution industry,” said Brad Jacobs, chairman and chief executive officer of QXO.
QXO has agreed to pay $124.35 per share in cash, the companies said on Thursday. The offer is only 10 cents higher than the previous bid of $124.25, which Beacon rejected in January, saying it “significantly undervalued” the company.
The deal likely became increasingly attractive to Beacon amid escalating macro uncertainty, Trey Grooms, analyst at Stephens, wrote in a note.
U.S. President Donald Trump’s extensive import tariffs have increased uncertainty for businesses, consumers and investors, and have fueled concerns about an economic slowdown.
Shares of QXO were up 3%, while Beacon’s shares rose 1.9%.
The company, which counts Trump’s son-in-law Jared Kushner as a board member, has already obtained anti-trust, clearance in the United States and Canada to acquire Beacon.
QXO will be funding the deal with $5 billion in cash and financing commitments, covering the rest of the full purchase price, it said.
Earlier this week, QXO raised $830 million in private placement from institutional investors, contingent upon the deal with Beacon closing. It said it would sell about 67.5 million shares of its common stock at $12.30 per share.
QXO said in connection with the transaction, which is expected to close by April end, it has withdrawn its nomination of 10 independent director nominees for Beacon.
Source: Reuters.com