Newly formed building products distributor QXO on Wednesday went public with an $11 billion all-cash bid to acquire Beacon Roofing Supply.
The company announced that it made a proposal to Beacon’s board in November under which it would acquire all outstanding shares of the roofing supply giant for $124.25 per share.
QXO’s announcement also included the text of a letter sent Wednesday to Beacon’s chairman that accused Beacon of meeting QXO’s offer with “delays, cancellations and unreasonable preconditions.”
“The Beacon board of directors appears to have priorities that do not include capturing a compelling premium and creating significant, immediate value for Beacon shareholders,” QXO CEO Brad Jacobs wrote in the letter.
Jacobs, the billionaire former head of logistics providers XPO and GXO and equipment rental firm United Rentals, formed QXO last year through a takeover of the former SilverSun Technologies. Officials indicated that QXO hoped to rapidly increase its scale through acquisitions.
After a $9.4 billion offer for electrical distributor Rexel was rejected, the Wall Street Journal reported in November that QXO had turned its attention to Beacon.
Jacobs’ letter accused Beacon’s board of a months-long campaign to “frustrate” the proposed transaction, including, most recently, a lengthy “standstill” provision preventing QXO from taking the matter directly to Beacon shareholders. He also suggested that Beacon had approached other potential buyers in December, but that no other offers had materialized and that Beacon had not submitted a counteroffer to QXO.
“We are available to meet at short notice to get a deal done,” Jacobs wrote. “If that does not happen, we intend to let your shareholders decide whether they want our compelling offer.”
QXO is set to begin trading Friday on the New York Stock Exchange.
