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Following news that QXO (QXO, Financials) offered an all-cash purchase of the firm for $124.25 per share, Beacon Roofing Supply (BECN, Financials) saw its shares finish at $117.18, up 7.65% on Wednesday at 4:00 PM EST. Representing a 37% premium over its 90-day volume-weighted average price of $91.02, the purchase values Beacon at over $11 billion.
According to QXO Chairman and CEO Brad Jacobs, the offer gives Beacon stockholders "compelling value." First presented in November 2024, the idea has suffered delays and what QXO called a lack of substantial board participation from Beacon.
Over Beacon's unchanged trade price of $98.75 on November 15, 2024, the proposed purchase price additionally includes a 26% premium over all-time high share price of $105.84. The offer offers a 3.0x premium to Beacon's three-year historical average enterprise value-to-EBITDA multiple, QXO underlined.
QXO said it had obtained funding to pay relevant transaction expenses, restructure Beacon's debt, and cover the acquisition price. Jacobs further said that should the board continue to object to involvement, the business is ready to forward the idea straight to shareholders.
The stock performance of Beacon Roofing Supply and QXO's offer have attracted notice as QXO aims to penetrate the $800 billion construction goods distribution sector. According to QXO, the purchase fits their approach of using acquisitions and natural expansion to grow.
This article first appeared on GuruFocus.