H&E: H&E Equipment Services Surges on Herc Holdings Acquisition Proposal
Deal News | Feb 19, 2025 | EIN
H&E Equipment Services has received a superior acquisition proposal from Herc Holdings, which subsequently led to a 12% surge in H&E's stock, hitting record highs. Herc Holdings is offering H&E shareholders $78.75 in cash and 0.1287 shares of Herc stock per H&E share, resulting in a total value of $104.89 per share. This deal surpasses the earlier offer from United Rentals which was valued at $92 per share. Herc's proposition includes an estimated $300 million in EBITDA benefits by the end of the third year post-closure. However, H&E would need to pay a termination fee of approximately $63.5 million if they switch from United Rentals to Herc. United Rentals has chosen not to revise its offer, allowing H&E to potentially shift to Herc's proposal. Herc's CEO, Larry Silber, emphasizes the strategic growth potential this merger holds. Despite the news of the proposal, Herc's stock fell by over 14%, while United Rentals' stock decreased over 3%. The sentiment of retail investors regarding H&E remains bullish, contrasting with the bearish outlook on Herc and United Rentals.
Sectors
- Construction and Mining Machinery
- Private Equity and Investment Banking
Geography
- United States – H&E Equipment Services, Herc Holdings, and United Rentals are all based in the United States, making the geographical focus of the article primarily US-centric.
Industry
- Construction and Mining Machinery – Both H&E Equipment Services and Herc Holdings operate within the rental equipment sector, providing machinery for construction and mining activities.
- Private Equity and Investment Banking – The article discusses acquisition offers and financial strategies which are core to the private equity and investment banking sectors.
Financials
- 104.89 – Total per-share value of Herc Holdings' acquisition proposal for H&E Equipment Services.
- 92 – Per-share cash offer from United Rentals for H&E Equipment Services.
- 0.1287 – Shares of Herc stock offered per share of H&E in the acquisition proposal.
- 63.5 – Termination fee H&E must pay to United Rentals if they accept Herc Holdings' proposal.
- 300 – Millions of dollars expected in EBITDA benefits from the merger by Herc Holdings.
Participants
| Name | Role | Type | Description |
|---|---|---|---|
| H&E Equipment Services (HEES) | Target Company | Company | A rental equipment company and the subject of acquisition proposals from Herc Holdings and United Rentals. |
| Herc Holdings Inc. (HERC) | Bidding Company | Company | A company in the equipment rental sector proposing a superior acquisition deal to H&E Equipment Services. |
| United Rentals, Inc. (URI) | Selling Company | Company | Initially proposed an acquisition of H&E Equipment Services but has declined to revise its offer after Herc's proposal. |
| Larry Silber | CEO | Person | CEO of Herc Holdings, commenting on the strategic benefits of the proposed merger with H&E. |