Billionaire Brad Jacobs’ new building-products distributor QXO offered to acquire GMS (NYSE:GMS) for about $5 billion in cash and said it will proceed with a hostile takeover if the company’s management rejects the proposal.
This is Jacobs’s second hostile takeover threat in the building sector this year and part of his plan to turn QXO into a $50 billion revenue building-products distributor within a decade.
Home improvement chain Home Depot (NYSE:HD) has also made an offer for GMS, The Wall Street Journal reported on Thursday, citing people familiar with the matter.
Spokespersons for Home Depot and GMS declined to comment on the report.
The Jacobs’s offer comes three months after QXO clinched an $11-billion deal to buy Beacon Roofing Supply, ending a prolonged takeover battle for the roofing company and significantly expanding its footprint in the U.S. and Canada.
Media reports say the acquisition of GMS would expand QXO’s market from roofs into house interior materials, including drywall.
QXO’s proposal is still technically in the friendly phase, but Jacobs said that if GMS’s board did not accept the offer by June 24, QXO was prepared to bypass management.
Shares in GMS hiked $21.93, or 27.1%, to $102.94, while HD shares sprang up $1.51 to $--$348.55.
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