Beacon Roofing Rejects $11 Billion Buyout Bid: Retail Sentiment Rallies In Support

Shares of Beacon Roofing Supply ($BECN) slipped 0.23% in after-hours trading on Wednesday after surging more than 7% earlier in the day as the company rejected an $11 billion takeover bid from QXO Inc. ($QXO), lifting retail sentiment.

Technology solutions company QXO had offered to buy all outstanding shares of Beacon for $124.25 per share in cash.

In a statement, Beacon said the proposal significantly undervalued the company and wasn’t in the best interest of its shareholders and the company.

According to the statement, Beacon had sought “substantive engagement with QXO to demonstrate path to value,” but the latter allegedly refused.

“After careful review and deliberation, our board unanimously determined that QXO’s proposal significantly undervalues Beacon and fails to reflect the company’s growth strategy and upside potential,” Stuart Randle, Beacon’s chair said.

“Beacon has a proven track record of delivering superior results and shareholder value, having generated total shareholder returns under our current management team of more than 200% during the past five years, and is building on the opportunity ahead through our strategic plan, which the company will discuss in greater detail at its upcoming investor day,” he explained.

Randle added the company’s board remains open to all opportunities to maximize shareholder value.

On Wednesday, QXO made public its $124.25 per share offer for Virginia-based Beacon, stating it had originally made the offer in November.

The company also said it had secured the committed financing for the deal and was getting ready to nominate directors to Beacon’s board, WSJ reported. QXO is owned by billionaire Brad Jacobs who has invested previously in logistics companies.

Julian Francis, Beacon’s president and CEO, added he was “enthusiastic about Beacon’s growth prospects and upside potential.”

Sentiment on Stocktwits improved to ‘extremely bullish’ from ‘neutral’ a day ago. Message volumes rose to ‘extremely high’ from ‘high’ levels.

BECN sentiment meter and message volume on Jan 16 as of 3:00 am ET

Beacon distributes specialty building products, including roofing materials and complementary products, such as siding and waterproofing. It operates over 580 branches throughout all 50 states in the U.S. and seven provinces in Canada.

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