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(Bloomberg) -- H&E Equipment Services has ended its previous agreement with United Rentals Inc. to accept a higher offer from Herc Holdings Inc., a statement from Herc confirmed Tuesday.
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Herc’s proposal for a cash-and-stock deal valued at $104.89 a share represents a 14% premium to the earlier agreement with United Rentals, according to the statement. United Rentals had planned to buy H&E for $92 a share in cash.
United Rentals, after H&E notified it of a higher bid, abandoned its plan to acquire the rival construction equipment supplier, declining to increase its original offer, according to a separate statement Tuesday. H&E is required to pay a fee of $63.5 million if it terminates the agreement, United Rentals said.
Shares of Herc fell 7.7% Tuesday. H&E shares jumped 15%, while United Rentals shares fell 2.8%.
H&E rents and sells equipment for purposes such as aerial work, earthmoving and material handling. Herc offers similar equipment for rent. Herc said the acquisition will expand its footprint in key regions.
The Financial Times reported earlier that H&E had accepted a bid from Herc valuing the company at almost $5.3 billion, including $1.4 billion of net debt. That cash-and-stock bid values H&E at about $500 million more than the United Rentals deal.
(Updates with Herc statement starting in first paragraph)
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