Billionaire Brad Jacobs and Home Depot Trigger Cage-Match Over GMS Buyout…

By Stocks News   |   3 weeks ago   |   Stock Market News
Billionaire Brad Jacobs and Home Depot Trigger Cage-Match Over GMS Buyout…

“Let’s get it on…”

Brad Jacobs, a man best known for building empires out of stuff regular people throw away (Waste Management and United Rental) and founder of QXO, just pounded the table with a $5 billion straight cash homie offer to buy GMS, the the drywall-and-ceilings distributor you only hear about if you’re renovating a strip mall or serving a subpoena. Jacobs’ company, QXO, is offering $95.20 per share, a 17% premium over Wednesday’s close… and if they don’t take it? His exact words: “I’ll go straight to your shareholders.” 

Billionaire Brad Jacobs

(Source: Giphy) 

Big swingin’ d*ck energy we have going on here ehh? That is, until Home Depot stepped in with a “not today” plot twist. According to reports, The Wall Street Journal says, Home Depot (fresh off its $18 billion SRS Distribution shopping spree and apparently not satisfied until it controls every aisle from roofing to whatever sad DIY my wife is about to have me ruin this weekend), has thrown in a competing bid to steal GMS from Jacobs grasps. 

Why? Because they want GMS’s “pro” business… a.k.a. The the part that actually makes money and doesn’t involve chasing after TikTok dads who think they can retile a bathroom without starting a fire. After swallowing SRS Distribution for $18 billion, they’ve caught acquisition fever and are now hunting for anything that doesn’t already have an orange apron stapled to it.

Billionaire Brad Jacobs

(Source: CNBC) 

Jacobs, meanwhile, is trying to speedrun the “$50 billion revenue” challenge, mostly by buying anything that isn’t nailed down and then telling the world he can run it better. If there’s a more on-brand move for a guy who’s built fortunes out of trash and trucks, I don’t know what it is.

With that said, QXO is also coming in hot after its own $11 billion acquisition of Beacon Roofing and Jacobs has made it pretty damn clear that he’s tired of “friendly chats” with GMS’s board. Which again, is why he says that if they don’t play ball by June 24th… he’ll go full Karen to the shareholders. For more context, the last time he did this, he called the target company’s management “poorly run” and then, for good measure, put half of them out to pasture. 

Billionaire Brad Jacobs

(Source: Investopedia) 

As for GMS, they are in paradise here. Word is their bankers at JPMorgan and Jefferies have been dialing up everyone short of Bob the Builder, hoping for a white knight willing to overpay for ceiling tiles and steel framing. (Spoiler: if your board starts fielding calls from Jefferies after hours, you’re already cooked.) Which is why while Jacobs presumably had this in the bag, Home Depot has done what Home Depot does best… “F’ sh*t up” (literally and figuratively). 

Naturally, this is exactly the drama investors live for. GMS stock is levitating +4.84% this week (+7.63% MTD), and every hedge fund analyst who’s ever set foot inside a Lowe’s is mainlining Adderall and updating their predictions. Bottom line: GMS is about to get sold… one way or another. Either Jacobs gets his next building block, or Home Depot gets to brag that they outbid a billionaire. 

Billionaire Brad Jacobs

(Source: Giphy) 

Meaning, for now, while we don’t know the details of Home Depot's offer yet, it’s enough to make GMS’ wandering eye wander from Jacobs. So you can expect this to get hostile. Of course, we’ll see how this shakes out, but in the meantime, place your bets accordingly and keep your head on the swivel. Until next time, friends…

Billionaire Brad Jacobs

At the time of publishing, Stocks.News does not hold positions in companies mentioned in the article. 

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