In what’s being called an $11 billion deal, the purchase will create a new powerhouse in the building sector.
For QXO it’s the latest acquisition as it continues to build out its business in the trade and there are more to come the company says.
“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. “We will be applying our proven playbook to a platform ripe to deliver above-market organic growth and significant margin expansion.”
The deal, still subject to Beacon shareholder approval, is priced at $124.35 a share and is expected to close by the end of April. Beacon is a leading distributor of roofing, waterproofing and exterior products, with almost 600 branches across the U.S. and Canada.
QXO spokesman Joe Checkler, in an interview, said the Connecticut-based company expects “Beacon to be the first of many acquisitions, putting us on a track toward our intended goal of $50 billion in revenue. Beacon is a great company in a large and growing industry, and we’re confident that the same playbook we used in waste management, equipment rental and transportation is completely applicable to Beacon’s business.”
QXO previously purchased Norbert Dentressangle and Con-way in 2015, he said. “We see similar opportunities with Beacon.”
“Since QXO made its initial offer last November, we have evaluated strategic alternatives to enhance value for all of our shareholders,” said Beacon’s chairman Stuart Randle. “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.”
