Shares of GMS have surged 29% following billionaire Brad Jacobs’ QXO proposal to acquire the building-products distributor for about $5 billion in cash.
Jacobs, who aims to grow QXO into a $50 billion revenue company within ten years, warned he is ready to pursue a hostile takeover if GMS’s board rejects the offer by June 24.
This is Jacobs’s second takeover threat in the building sector this year. Home Depot has also reportedly made a bid for GMS, though both companies declined to comment.
QXO’s bid follows its recent $11 billion acquisition of Beacon Roofing Supply, expanding its footprint in the US and Canada. Buying GMS would extend QXO’s reach into interior building materials such as drywall.
Jacobs criticised GMS’s management and believes the company could deliver greater profitability under his leadership. The $95.20-per-share offer represents a 17% premium over GMS’s closing price before the proposal.
GMS confirmed receipt of the unsolicited offer and said its board is reviewing it. Backed by Goldman Sachs and Morgan Stanley, QXO’s bid signals significant consolidation ahead in the US building materials market.
GMS stock was up $23.45 at $104.55.