Beacon Roofing in Talks With QXO for Potential $11B Deal
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Beacon Roofing Supply Inc. is in talks to be bought by QXO Inc. for about $11 billion including debt after rejecting an earlier takeover approach.
The companies said in a joint statement March 10 that they are discussing a combination in which QXO would acquire Beacon for $124.35 a share — 10 cents higher than the price Beacon rejected as undervaluing it.
QXO and Beacon are negotiating a definitive agreement, and Beacon is postponing an investor day that was scheduled for March 13, according to the statement. The companies said there’s no assurance the talks will result in a transaction.
Beacon ranks No. 63 on the Transport Topics Top 100 list of the largest private carriers in North America and No. 8 on the building materials carriers sector list.
Jacobs
The battle for control of Beacon, which has been ongoing since November, accelerated this year after QXO went hostile with its offer of $124.25 a share. Beacon has solicited interest from potential rival buyers and adopted a poison pill defense to fend off QXO. As recently as last week, Beacon advised its shareholders not to tender shares to QXO.
Herndon, Va.-based Beacon provides commercial and residential roofing, siding, windows, decking, insulation, specialty lumber, waterproofing and air-barrier systems to the North American building industry. The company’s shares rose 7.8% to $119.74 at 12:16 p.m. March 10 in New York trading, giving it a market value of about $7.4 billion.
QXO is a building products company run by veteran dealmaker Brad Jacobs, who is executive chairman of XPO and non-executive chairman of RXO and GXO Logistics.
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If QXO reaches an agreement with Beacon, it will be the first of many acquisitions in the building products industry, QXO spokesperson Joe Checkler said. Checkler said that the company believes it can double Beacon’s earnings before interest, taxes, depreciation and amortization over the next five years.
“We’re highly confident that the playbook we’ve used in the waste management, equipment rental and transportation business is completely applicable to Beacon,” Checkler said.
