United Rentals, Inc. (URI, Financial) has entered into a definitive Agreement and Plan of Merger with H&E Equipment Services, Inc. (H&E), marking a significant strategic acquisition. The transaction, unanimously approved by URI's board of directors, involves a two-step all cash process, beginning with a tender offer followed by a back-end merger.
Under the terms of the Merger Agreement, URI will initiate a cash tender offer to acquire all outstanding shares of H&E's common stock at a price of $92.00 per share. This offer will remain open for twenty business days, with potential extensions if necessary conditions are not met. Upon successful completion of the tender offer, H&E will merge with a wholly owned subsidiary of URI, becoming a wholly owned subsidiary itself.
The merger is subject to customary conditions, including regulatory clearance under the Hart-Scott-Rodino Antitrust Improvements Act. Additionally, the agreement includes a 35-day "go-shop" period, allowing H&E to solicit alternative acquisition proposals. If a superior proposal emerges, H&E may terminate the agreement, subject to a termination fee.
To finance the acquisition, URI has secured a bridge facility commitment letter for a $3.8 billion senior unsecured bridge term loan, with plans to replace it with permanent financing before the merger's closure.
This strategic acquisition is expected to enhance URI's market position and operational capabilities, aligning with its long-term growth objectives. Investors and stakeholders will be closely monitoring the developments of this transaction.
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