Proposal Significantly Undervalues the Company
and is Not in the Best Interests of Beacon and its Shareholders
On Multiple Occasions Beacon Sought Substantive
Engagement with QXO to Demonstrate Path to Value; QXO Refused
Beacon to Hold Investor Day on March 13, 2025,
Where Company Will Provide 2028 Long-Term Financial Targets
Shareholders Do Not Need to Take Action At This
Time
Beacon (Nasdaq: BECN) (the “Company”) today confirmed that it
has previously received and rejected an unsolicited, non-binding
proposal from QXO, Inc. (Nasdaq: QXO) to acquire all outstanding
shares of the Company for $124.25 per share in cash.
QXO’s proposal, publicized today, was received on November 11,
2024. Consistent with its fiduciary duties, and in consultation
with its independent financial and legal advisors, Beacon’s Board
of Directors (the “Board”) thoroughly evaluated the proposal.
Following its review, the Board unanimously rejected the proposal
and determined that it significantly undervalues the Company and
its prospects for growth and future value creation. The Board
therefore determined that QXO’s proposal was not in the best
interests of Beacon and its shareholders.
Contrary to QXO’s assertions, Beacon offered on multiple
occasions to engage, including to discuss price, subject only to a
standard non-disclosure agreement (NDA). Additionally, Beacon:
- Held repeated discussions between members of the Beacon
executive team and QXO, as well as with the respective advisors of
the parties.
- Offered a standard NDA to share confidential management
projections and other relevant company information to further
develop QXO’s valuation of Beacon. QXO refused to engage on
multiple occasions, stating that it was not interested in any
confidential information.
- Offered to limit the duration of the customary confidentiality
obligations as part of the NDA only through Beacon’s planned
Investor Day on March 13, at which point 2028 long-term targets
will be presented.
- Structured the NDA to preserve QXO’s ability to run a proxy
contest at the upcoming 2025 annual meeting of shareholders.
“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,” said Stuart Randle, Beacon’s Chair of the Board.
“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,1 and is building on the opportunity ahead through our
strategic plan, which the Company will discuss in greater detail at
its upcoming Investor Day.”
Mr. Randle continued, “Importantly, Beacon has acted in good
faith to engage with QXO to show them a path to value in a
timeframe that would preserve their rights and flexibility.
However, QXO has refused to improve its first and only proposal,
which the Board determined significantly undervalues the Company.
Our Board remains open to all opportunities to maximize shareholder
value and is fully committed to acting in the best interests of
Beacon and all of its shareholders.”
“We are enthusiastic about Beacon’s growth prospects and upside
potential, and through the successful execution of Ambition 2025,
Beacon is delivering above-market growth, driving operational
excellence and building a winning culture,” said Julian Francis,
Beacon’s President and CEO. “These achievements have enabled us to
create a differentiated business model with multiple paths to
success, margin expansion and value creation. We look forward to
discussing at our Investor Day how we will enter our next chapter
of growth, including our new long-term goals.”
J.P. Morgan is serving as financial advisor and Sidley Austin
LLP and Simpson Thacher and Bartlett LLP are legal advisors to
Beacon.
About Beacon
Founded in 1928, Beacon is a publicly-traded Fortune 500 company
that distributes specialty building products, including roofing
materials and complementary products, such as siding and
waterproofing. The company operates over 580 branches throughout
all 50 states in the U.S. and 7 provinces in Canada. Beacon serves
an extensive base of nearly 100,000 customers, utilizing its vast
branch network and service capabilities to provide high-quality
products and support throughout the entire project lifecycle.
Beacon offers its own private label brand, TRI-BUILT ®, and has a
proprietary digital account management suite, Beacon PRO+ ®, which
allows customers to manage their businesses online. Beacon’s stock
is traded on the Nasdaq Global Select Market under the ticker
symbol BECN. To learn more about Beacon, please visit
www.becn.com.
Forward Looking Statements
This release contains information that may constitute
forward-looking statements for purposes of the safe harbor
provisions under the Private Securities Litigation Reform Act of
1995. Forward-looking statements can be identified by the fact that
they do not relate strictly to historic or current facts and often
use words such as “anticipate,” “estimate,” “expect,” “believe,”
“will likely result,” “outlook,” “project” and other words and
expressions of similar meaning. Investors are cautioned not to
place undue reliance on forward-looking statements. Actual results
may differ materially from those indicated by such forward-looking
statements as a result of various important factors, including, but
not limited to, those set forth in the “Risk Factors” section of
the Company’s Form 10-K for the fiscal year ended December 31, 2023
and subsequent filings with the U.S. Securities and Exchange
Commission (the “SEC”). The Company may not succeed in addressing
these and other risks. Consequently, all forward-looking statements
in this release are qualified by the factors, risks and
uncertainties contained therein. In addition, the forward-looking
statements included in this press release represent the Company’s
views as of the date of this press release and these views could
change. However, while the Company may elect to update these
forward-looking statements at some point, the Company specifically
disclaims any obligation to do so, other than as required by
federal securities laws. These forward-looking statements should
not be relied upon as representing the Company’s views as of any
date subsequent to the date of this release.
Important Additional Information
The Company intends to file a proxy statement on Schedule 14A,
an accompanying proxy card, and other relevant documents with the
SEC in connection with such solicitation of proxies from the
Company’s stockholders for the Company’s 2025 annual meeting of
stockholders. THE COMPANY’S STOCKHOLDERS ARE STRONGLY ENCOURAGED TO
READ THE COMPANY’S DEFINITIVE PROXY STATEMENT (INCLUDING ANY
AMENDMENTS OR SUPPLEMENTS THERETO), THE ACCOMPANYING PROXY CARD,
AND ALL OTHER DOCUMENTS FILED WITH THE SEC CAREFULLY AND IN THEIR
ENTIRETY WHEN THEY BECOME AVAILABLE BECAUSE THEY WILL CONTAIN
IMPORTANT INFORMATION. Investors and stockholders may obtain a copy
of the definitive proxy statement, an accompanying proxy card, any
amendments or supplements to the definitive proxy statement and
other documents filed by the Company with the SEC at no charge at
the SEC’s website at www.sec.gov. Copies will also be available at
no charge by clicking the “SEC Filings” link in the “Financials
& Presentations” section of the Company’s website,
https://ir.beaconroofingsupply.com/.
Participants in the Solicitation
The Company, its directors, certain of its officers, and other
employees may be deemed to be “participants” (as defined in Section
14(a) of the Exchange Act of 1934, as amended) in the solicitation
of proxies from the Company’s stockholders in connection with
matters to be considered at the Company’s 2025 annual meeting of
stockholders. Information about the names of the Company’s
directors and officers, their respective interests in the Company
by security holdings or otherwise, and their respective
compensation is set forth in the sections entitled “Information
About our Nominees,” “Compensation of Directors,” “Executive
Compensation” and “Stock Ownership” of the Company’s Proxy
Statement on Schedule 14A in connection with the 2024 annual
meeting of stockholders, filed with the SEC on April 3, 2024
(available here) and the Company’s Annual Report on Form 10-K filed
with the SEC on February 28, 2024 (available here). To the extent
the security holdings of directors and executive officers have
changed since the amounts described in these filings, such changes
are set forth on Initial Statements of Beneficial Ownership on Form
3, Statements of Change in Ownership on Form 4, or Annual
Statements of Beneficial Ownership on Form 5 filed with the SEC,
which can be found at no charge at the SEC’s website at
www.sec.gov. Updated information regarding the identity of
potential participants and their direct or indirect interests, by
security holdings or otherwise, in the Company will be set forth in
the Company’s Proxy Statement on Schedule 14A for the 2025 annual
meeting of stockholders and other relevant documents to be filed
with the SEC, if and when they become available. These documents
will be available free of charge as described above.
1 January 2, 2020 – November 15, 2024 (the last trading day
prior to rumors being published)
View source
version on businesswire.com: https://www.businesswire.com/news/home/20250115881586/en/
Beacon Contacts: Media Jennifer Lewis VP,
Communications and Corporate Social Responsibility
Jennifer.Lewis@becn.com 571-752-1048 Ed Trissel / Andrea Rose Joele
Frank, Wilkinson Brimmer Katcher 212-355-4449 Investors
Binit Sanghvi VP, Capital Markets and Treasurer
Binit.Sanghvi@becn.com 972-369-8005 Bruce Goldfarb / Pat McHugh
Okapi Partners LLC (888) 785-6673 (212) 297-0720
info@okapipartners.com
Beacon Roofing Supply (NASDAQ:BECN)
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