Beacon adopts defensive strategy
Following a hostile takeover bid from QXO, Beacon Roofing Supply Tuesday morning moved to prevent or at least slow down any acquisition by introducing a financial ‘poison pill.'
A poison pill is the business term for a strategy designed to prevent hostile takeovers by making them more expensive to the acquirer.
In response to the QXO bid, Herndon, Va-based Beacon said its board has unanimously adopted a limited duration stockholder rights agreement. Under it, Beacon will issue one preferred share purchase right for each outstanding share of Beacon common stock to stockholders on February 7, 2025.
The company says the move gives Beacon sufficient time to review QXO’s tender offer and consider the best approach to enhance the interests of Beacon and its stockholders.
QXO Chairman and CEO Brad Jacobs fired back Tuesday morning, describing the move as “shareholder unfriendly.”
Jacobs added: “We launched our all-cash tender offer to ensure that Beacon’s shareholders can take advantage of our compelling offer and get paid quickly. We have committed financing, have no due diligence condition and anticipate a smooth regulatory approval process to close. The only thing stopping shareholders from acting to get cash expeditiously is the decision by Beacon’s Board to adopt a poison pill.”
QXO’s $124.25 per share offer—a potential $11 billion deal—represents a 37% premium to Beacon’s 90-day unaffected volume-weighted average price of $91.02 per share as of November 15, 2024, and a 26% premium to the $98.75 price before its proposal became public.
