Home Depot has made a move to acquire building-products distributor GMS, setting the stage for a potential bidding war with Brad Jacobs’ QXO, according to a report by The Wall Street Journal.
The exact terms of Home Depot’s bid have not been disclosed, but it follows QXO’s public offer of $95.20 per share, a $5 billion all-cash proposal made on Wednesday.
GMS confirmed it had received QXO’s offer and said its board would review the proposal.
Shares of GMS, based in Tucker, Georgia, have surged amid takeover speculation and now value the company at around $3.1 billion.
GMS operates more than 320 distribution centers and 100 tool rental and service hubs, serving both residential and commercial contractors.
Both suitors are vying to capture more share in the fragmented building materials market.
Home Depot, already a giant in home improvement with a market cap of $345 billion, is seeking to deepen its foothold among professional contractors.
Its recent $18.25 billion acquisition of SRS Distribution marked a significant push in that direction.
QXO, with a smaller $13 billion market cap, is no less ambitious. The company is led by serial acquirer Brad Jacobs, who has built his career through industry roll-ups.
Earlier this year, Jacobs secured an $11 billion deal for Beacon Roofing Supply, a deal that began as a rejected offer and turned hostile before finalising with only a modest price increase.
QXO has given GMS until June 24 to respond and has indicated it’s prepared to take the offer directly to shareholders if needed, hinting at a repeat of its Beacon playbook.
GMS, which itself grew through multiple acquisitions, now finds itself at the centre of one of the year’s most watched M&A battles in the construction supply sector.
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