QXO Won’t Raise Its Offer for GMS After ý Depot Bid
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QXO Inc. won’t raise its $5 billion offer for building products distributor GMS Inc. after ý Depot Inc. reportedly made its own bid.
A spokesman for QXO said June 20 that $5 billion is the company’s full offer. The Wall Street Journal reported June 19 that ý Depot had submitted a bid for an undetermined sum. Representatives for ý Depot and GMS declined to comment.
ý Depot ranks No. 50 on theTransport Topics Top 100 list of the largest private companiesin North America.
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.
READ MORE:QXO to Acquire Beacon Roofing Supply in $11 Billion Deal
QXO’s unsolicited offer of $95.20 a share represented a 27% premium to GMS’ 60-day volume-weighted average, according to a statement June 18. GMS shares jumped as much as 30% in June 20 trading, touching a high of $105.14, suggesting investors expect the winning bid to be higher.
Jacobs
“QXO has a history of ‘one and done’ offers for companies while HD, in our view, may be willing to pay a higher multiple,” Keith Hughes, an analyst at Truist Securities, wrote in a research note. Truist doesn’t expect any other bidders aside from QXO and ý Depot.
ý Depot’s reported interest in GMS aligns with the retailer’s goal of expanding its market share with professional contractors, Bloomberg Intelligence analyst Drew Reading said.
Shares of QXO rose as much as 6% on June 20. ý Depot shares gained 0.8% at 11:18 a.m. in New York.
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