QXO and Beacon Roofing Supply announced that they have entered into a definitive merger agreement under which QXO will acquire Beacon for $124.35 per share in cash. Beacon is a leading distributor of roofing, waterproofing, and exterior products, with nearly 600 branches across the U.S. and Canada.
The boards of directors at both companies have unanimously approved the transaction, which values Beacon at approximately $11 billion, including all its outstanding debt. And the deal is expected to close by the end of April, subject to a majority of Beacon shares tendering in the offer and other customary closing conditions. Beacon’s board unanimously recommends that all shareholders tender their shares into the offer.
On January 27, 2025, QXO commenced an all-cash tender offer to acquire all of the outstanding shares of Beacon. And QXO announced that it has extended its current tender offer to expire at 5:00 p.m., New York City Time, on March 31, 2025.
QXO will amend the current tender offer on or before the new expiration date to reflect the terms of the definitive merger agreement with Beacon, including an offer price of $124.35 per share in cash.
In connection with the deal, QXO has withdrawn its nomination of 10 independent director nominees for election at Beacon’s 2025 annual meeting of shareholders, and Beacon has exempted the tender offer from its previously adopted shareholder rights plan.
The acquisition has received antitrust clearance in the U.S. and Canada. And QXO has $5 billion of cash and secured financing commitments covering the full purchase price, including debt refinancing and transaction costs. As reported earlier, QXO also entered into purchase agreements with certain institutional investors for a financing of $830 million in private placement, subject to the completion of the Beacon acquisition.
Morgan Stanley is acting as the lead financial advisor to QXO. And QXO is also being advised by Goldman Sachs, Citi, Centerview, Credit Agricole, Wells Fargo and Mizuho. Paul Weiss is acting as lead legal counsel to QXO, with Wachtell Lipton providing additional legal advice. J.P. Morgan is serving as financial advisor to Beacon and its board, and Lazard is serving as financial advisor to the Beacon board. Sidley Austin and Simpson Thacher are serving as legal advisors to Beacon.
KEY QUOTES:
“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. We will be applying our proven playbook to a platform ripe to deliver above-market organic growth and significant margin expansion.”
– Brad Jacobs, chairman and chief executive officer of QXO
“Since QXO made its initial offer last November, we have evaluated strategic alternatives to enhance value for all of our shareholders. Following our Board’s comprehensive review, we concluded that this transaction is in the best interests of Beacon and its shareholders given the immediate premium and certainty of value in cash it offers, particularly in an uncertain environment.”
– Stuart Randle, Beacon’s chairman
“Since the launch of Ambition 2025 three years ago, we successfully transformed Beacon, delivering superior financial and operational results. We have a highly differentiated business with multiple paths to success, margin expansion and value creation, and thanks to the incredible talent and dedication of our employees, I know Beacon has a bright future ahead. We will now enter a new chapter of growth, true to our mission to help our customers build more.”
– Julian Francis, president and chief executive officer of Beacon
