Roughly one month after announcing it was being acquired, Baton Rouge-based H&E Equipment Services Inc. has received a separate binding acquisition proposal and merger agreement from Herc Holdings Inc., one of North America’s leading equipment rental suppliers.
The acquisition proposal is pursuant to the “go-shop” provision as provided by H&E’s previously announced agreement with United Rentals Inc.
H&E’s board of directors has determined that Herc’s cash and stock merger is superior to the $92.00 per share cash sale to United Rentals, and H&E has notified United Rentals that it intends to terminate its merger agreement and enter into an agreement with Herc.
United Rentals does not intend to submit a revised proposal and has waived its four business day match period under the agreement.
Under the terms of the new proposal from Herc, H&E shareholders will receive $78.75 in cash and 0.1287 shares of Herc common stock for each share they own, with a total value of $104.89 per share based on Herc’s 10-day VWAP as of market close Feb. 14.
Following the close of the transaction, H&E’s shareholders would own approximately 14.1% of the combined company.
According to a prepared statement about the deal, Herc’s combination with H&E would accelerate Herc’s strategy to outpace industry growth by providing a substantially expanded footprint, increased density in key regions with economies of scale, geographic and customer diversification, and a larger, younger fleet.
“We are pursuing the proposed combination with H&E from a position of strength and view it as a path to accelerate Herc’s strategy and growth trajectory,” says Larry Silber, Herc’s president and CEO. “Herc has tremendous respect for H&E and the high quality of the platform and customer-centric culture of the organization.”
The transaction is expected to close midyear 2025, subject to the majority of H&E’s shares being tendered into the offer, the receipt of customary regulatory approvals, and closing conditions.
