Herc Holdings and H&E Equipment Services Enter into Definitive Merger Agreement
Herc Holdings (NYSE: HRI) and H&E Equipment Services (NASDAQ: HEES) have entered into a definitive merger agreement, with H&E terminating its prior agreement with United Rentals. Under the terms, H&E shareholders will receive $78.75 in cash and 0.1287 Herc shares per share, valuing H&E at $104.89 per share. H&E shareholders will own approximately 14.1% of the combined company.
The merger will strengthen Herc's position as North America's third-largest rental company, with a leading presence in 11 of the top 20 rental regions. The combined company is expected to generate $300 million in annual EBITDA synergies by year three, including $125 million in cost synergies and $175 million from revenue synergies. The combined entity will have revenue of $5.2 billion and EBITDA of $2.5 billion.
The transaction is expected to close mid-year 2025, subject to regulatory approvals and tender of majority H&E shares. The deal is projected to be high single-digit accretive to Herc's cash earnings per share in 2026.
Herc Holdings (NYSE: HRI) e H&E Equipment Services (NASDAQ: HEES) hanno stipulato un accordo di fusione definitivo, con H&E che termina il suo precedente accordo con United Rentals. Secondo i termini, gli azionisti di H&E riceveranno $78,75 in contante e 0,1287 azioni Herc per ogni azione, valutando H&E a $104,89 per azione. Gli azionisti di H&E possederanno circa il 14,1% della società combinata.
La fusione rafforzerà la posizione di Herc come la terza più grande società di noleggio in Nord America, con una presenza di leadership in 11 delle prime 20 regioni di noleggio. Si prevede che la società combinata genererà $300 milioni in sinergie annuali di EBITDA entro il terzo anno, inclusi $125 milioni in sinergie di costo e $175 milioni da sinergie di ricavi. L'entità combinata avrà un fatturato di $5,2 miliardi e un EBITDA di $2,5 miliardi.
Si prevede che la transazione si chiuda a metà del 2025, soggetta ad approvazioni regolatorie e all'offerta della maggioranza delle azioni H&E. L'affare dovrebbe avere un impatto positivo a singolo cifra alta sugli utili per azione in contante di Herc nel 2026.
Herc Holdings (NYSE: HRI) y H&E Equipment Services (NASDAQ: HEES) han firmado un acuerdo de fusión definitivo, con H&E finalizando su acuerdo previo con United Rentals. Según los términos, los accionistas de H&E recibirán $78.75 en efectivo y 0.1287 acciones de Herc por acción, valorando a H&E en $104.89 por acción. Los accionistas de H&E poseerán aproximadamente el 14.1% de la empresa combinada.
La fusión fortalecerá la posición de Herc como la tercera empresa de alquiler más grande de América del Norte, con una presencia destacada en 11 de las 20 principales regiones de alquiler. Se espera que la empresa combinada genere $300 millones en sinergias anuales de EBITDA para el tercer año, incluidos $125 millones en sinergias de costos y $175 millones de sinergias de ingresos. La entidad combinada tendrá ingresos de $5.2 mil millones y un EBITDA de $2.5 mil millones.
Se espera que la transacción se cierre a mediados de 2025, sujeta a aprobaciones regulatorias y la oferta de la mayoría de las acciones de H&E. Se proyecta que el acuerdo tenga un impacto positivo de un solo dígito alto en las ganancias por acción en efectivo de Herc en 2026.
Herc Holdings (NYSE: HRI)와 H&E Equipment Services (NASDAQ: HEES)가 최종 합병 계약을 체결했으며, H&E는 United Rentals와의 이전 계약을 종료했습니다. 조건에 따라 H&E 주주들은 주당 $78.75의 현금과 0.1287 Herc 주식을 받게 되며, H&E의 주가는 주당 $104.89로 평가됩니다. H&E 주주들은 합병된 회사의 약 14.1%를 소유하게 됩니다.
이번 합병은 Herc가 북미에서 세 번째로 큰 렌탈 회사로서의 입지를 강화하며, 20개 주요 렌탈 지역 중 11개 지역에서 선도적인 존재감을 갖게 됩니다. 합병된 회사는 3년 차에 연간 $300 백만의 EBITDA 시너지를 창출할 것으로 예상되며, 여기에는 $125 백만의 비용 시너지와 $175 백만의 수익 시너지가 포함됩니다. 합병된 실체의 수익은 $5.2 billion이고 EBITDA는 $2.5 billion에 이를 것입니다.
이번 거래는 2025년 중반에 마무리될 것으로 예상되며, 규제 승인 및 H&E 주식의 대다수 인수를 조건으로 합니다. 이 거래는 2026년 Herc의 현금 주당 수익에 대해 높은 한 자릿수의 긍정적인 영향을 미칠 것으로 예상됩니다.
Herc Holdings (NYSE: HRI) et H&E Equipment Services (NASDAQ: HEES) ont conclu un accord de fusion définitif, H&E mettant fin à son accord précédent avec United Rentals. Selon les termes, les actionnaires de H&E recevront 78,75 $ en espèces et 0,1287 action Herc par action, valorisant H&E à 104,89 $ par action. Les actionnaires de H&E posséderont environ 14,1 % de la société combinée.
La fusion renforcera la position de Herc en tant que troisième plus grande société de location en Amérique du Nord, avec une présence de leader dans 11 des 20 principales régions de location. La société combinée devrait générer 300 millions de dollars de synergies EBITDA annuelles d'ici la troisième année, y compris 125 millions de dollars de synergies de coûts et 175 millions de dollars de synergies de revenus. L'entité combinée aura un chiffre d'affaires de 5,2 milliards de dollars et un EBITDA de 2,5 milliards de dollars.
La transaction devrait être finalisée à la mi-2025, sous réserve des approbations réglementaires et de l'offre de la majorité des actions H&E. L'accord devrait avoir un impact positif à un chiffre élevé sur les bénéfices en espèces par action de Herc en 2026.
Herc Holdings (NYSE: HRI) und H&E Equipment Services (NASDAQ: HEES) haben eine endgültige Fusionsvereinbarung getroffen, wobei H&E seine vorherige Vereinbarung mit United Rentals beendet. Gemäß den Bedingungen erhalten die Aktionäre von H&E $78,75 in bar und 0,1287 Herc-Aktien pro Aktie, was H&E mit $104,89 pro Aktie bewertet. Die Aktionäre von H&E werden etwa 14,1% des fusionierten Unternehmens besitzen.
Die Fusion wird Hurcs Position als drittgrößtes Mietunternehmen in Nordamerika stärken, mit einer führenden Präsenz in 11 der 20 wichtigsten Mietregionen. Es wird erwartet, dass das fusionierte Unternehmen $300 Millionen an jährlichen EBITDA-Synergien im dritten Jahr generiert, einschließlich $125 Millionen an Kostensynergien und $175 Millionen aus Umsatzsynergien. Die fusionierte Einheit wird einen Umsatz von $5,2 Milliarden und ein EBITDA von $2,5 Milliarden haben.
Die Transaktion wird voraussichtlich Mitte 2025 abgeschlossen, vorbehaltlich der regulatorischen Genehmigungen und der Übernahme der Mehrheit der H&E-Aktien. Der Deal wird voraussichtlich im Jahr 2026 eine hohe einstellige Erhöhung des Cash-Earnings pro Aktie von Herc bewirken.
- Transaction strengthens Herc's position as 3rd largest rental company in North America
- Expected $300M annual EBITDA synergies by year three post-closing
- Combined revenue of $5.2B and EBITDA of $2.5B
- High single-digit EPS accretion expected in 2026
- Expanded presence in 11 of top 20 rental regions
- Net leverage projected to decrease below 3.0x within 24 months
- Initial net leverage of 3.8x at closing
- $63.5M termination fee paid to United Rentals
- Significant integration costs and execution risks
Insights
This transformative merger represents a strategic coup for Herc Holdings, significantly reshaping the North American equipment rental landscape. The $104.89 per share transaction not only consolidates Herc's position as the third-largest industry player but also creates a formidable competitor with enhanced market presence in 11 of the top 20 rental regions.
The deal's structure is particularly noteworthy, with H&E shareholders receiving both immediate value through the
The financial implications are compelling:
- Combined revenue of
$5.2 billion and EBITDA of$2.5 billion - Initial net leverage of 3.8x with a clear path to below 3.0x within 24 months
- High single-digit cash EPS accretion in 2026, expanding to
20%+ as synergies materialize
The termination of H&E's prior agreement with United Rentals, requiring a
The transaction's mid-2025 expected closing timeline allows for thorough integration planning while maintaining competitive momentum. The commitment to maintaining Herc's dividend policy demonstrates confidence in the combined entity's cash generation capabilities and financial strength.
Acquisition Scales Herc’s Premier Platform and Accelerates Strategy for Industry Leading Growth and Superior Value Creation
Transaction Terms Same as Proposal Previously Announced on February 18, 2025
H&E Terminates Agreement with United Rentals
As previously announced on February 18, 2025, under the terms of the Herc and H&E agreement, H&E shareholders will receive
“The acquisition of H&E is a unique opportunity to accelerate Herc’s proven strategy for industry leading growth and delivering superior shareholder value,” said Larry Silber, Herc’s president and chief executive officer. “We have great respect for the H&E team and the high-quality platform they built. We look forward to welcoming H&E’s talented employees to Herc and working together to realize the substantial benefits that this transaction will create for the shareholders, employees and customers of both companies.”
John M. Engquist, executive chairman of H&E, added, “This is an outstanding transaction for H&E shareholders, providing both immediate, premium value and the opportunity to participate in the substantial upside value that will be created through this combination. With Herc, we have found a partner who shares our dedication to a higher standard of work.”
Strategic and Financial Benefits
-
Increased scale with complementary footprint and fleet mix: The transaction strengthens Herc’s position as the 3rd largest rental company in
North America . The combined company will have a leading presence in 11 of the top 20 rental regions and increased urban density in 7 of the top 10 rental regions. In addition, it will have a larger, younger fleet, offering a variety of specialty equipment solutions and a broad range of general rental products. -
Approximately
$300 million $125 million $175 million -
Highly accretive: The transaction is expected to be high single digit accretive to Herc’s cash earnings per share in 2026 and ramping to greater than
20% as synergies are fully realized. In addition, the transaction is expected to generate ROIC in excess of Herc’s cost of capital within three years of closing. -
Attractive financial profile: The combination creates a company with revenue and EBITDA of approximately
$5.2 billion $2.5 billion - Financial strength and flexibility with net leverage of 3.8x at close, prior to synergy realization, and projected to be below 3.0x and in Herc’s targeted range within 24 months of closing. Herc’s dividend will be maintained.
- Valuation multiple re-rating warranted for combined company that is more consistent with comparable company valuation multiples in the sector given the powerful growth platform, increased liquidity, and greater investor interest that comes with a scaled company.
Transaction Details
Herc intends to commence a tender offer to acquire all of the outstanding shares of H&E common stock for
The transaction is expected to close mid-year 2025, subject to the majority of H&E’s shares being tendered into the offer, the receipt of customary regulatory approvals and closing conditions. Herc has obtained committed financing for the cash portion of the transaction.
In accordance with the terms of H&E’s prior agreement with United Rentals, Herc, on behalf of H&E, has paid a termination fee of
Presentation Materials and Conference Call / Webcast Replay
The press release and presentation slides that Herc previously issued on February 18, 2025 in connection with the H&E agreement as well as a replay of the associated conference call and webcast can be found on the Investor Relations section of Herc’s website at https://IR.HercRentals.com.
Herc Advisors
Guggenheim Securities, LLC is serving as lead financial advisor. Credit Agricole Securities (
H&E Advisors
BofA Securities acted as financial advisor to H&E and Milbank LLP acted as H&E's legal advisor.
About Herc Holdings Inc.
Founded in 1965, Herc Holdings Inc., which operates through its Herc Rentals Inc. subsidiary, is a full-line rental supplier with 453 locations across
About H&E Equipment Services, Inc.
Founded in 1961, H&E is one of the largest rental equipment companies in the nation. The Company’s fleet is comprised of aerial work platforms, earthmoving, material handling, and other general and specialty lines. H&E serves a diverse set of end markets in many high-growth geographies and has branches throughout the Pacific Northwest, West Coast, Intermountain, Southwest, Gulf Coast, Southeast, Midwest and Mid-Atlantic regions.
Cautionary Note Regarding Forward Looking Statements
This communication includes “forward-looking statements,” within the meaning of Section 21E of the Securities Exchange Act, as amended, and the Private Securities Litigation Reform Act of 1995. Forward-looking statements include statements related to the Company, H&E and the proposed acquisition of H&E by the Company that involve substantial risks, uncertainties and assumptions that could cause actual results to differ materially from those expressed or implied by such statements. Forward-looking statements in this communication include, among other things, statements about the potential benefits of the proposed transaction, the Company’s plans, objectives, expectations and intentions, the financial condition, results of operations and business of each of the Company and H&E, expected valuation and re-rating opportunities for the combined company, and the anticipated timing of closing of the proposed transaction. Forward-looking statements are generally identified by the words "estimates," "expects," "anticipates," "projects," "plans," "intends," "believes," "forecasts," "looks," and future or conditional verbs, such as "will," "should," "could" or "may," as well as variations of such words or similar expressions. All forward-looking statements are based upon our current expectations and various assumptions and apply only as of the date of this communication. Our expectations, beliefs and projections are expressed in good faith and we believe there is a reasonable basis for them. However, there can be no assurance that our expectations, beliefs and projections will be achieved or that the completion and anticipated benefits of the proposed transaction can be guaranteed, and actual results may differ materially from those projected. You should not place undue reliance on forward-looking statements.
There are a number of risks, uncertainties and other important factors that could cause our actual results to differ materially from those suggested by our forward-looking statements, including, but not limited to, (i) the possibility that the sufficient number of H&E’s shares are not validly tendered into the tender offer to meet the minimum condition; (ii) the Company’s ability to implement its plans, forecasts and other expectations with respect to H&E’s business after the completion of the proposed transaction and realized expected synergies; (iii) the ability to realize the anticipated benefits of the proposed transaction, including the possibility that the expected benefits from the proposed transaction will not be realized or will not be realized within the expected time period; (iv) the Company and H&E may be unable to obtain regulatory approvals required for the proposed transaction or may be required to accept conditions that could reduce the anticipated benefits of the proposed transaction as a condition to obtaining regulatory approvals; (v) the length of time necessary to consummate the proposed transaction may be longer than anticipated; (vi) problems may arise in successfully integrating the businesses of the Company and H&E, including, without limitation, problems associated with the potential loss of any key employees, customers, suppliers and other counterparties of H&E; (vii) the proposed transaction may involve unexpected costs, including, without limitation, the exposure to any unrecorded liabilities or unidentified issues during the due diligence investigation of H&E or that are not covered by insurance, as well as potential unfavorable accounting treatment and unexpected increases in taxes; (viii) the Company’s business may suffer as a result of uncertainty surrounding the proposed transaction, any adverse effects on our ability to maintain relationships with customers, employees and suppliers; (ix) the occurrence of any event, change to other circumstances that could give rise to the termination of the merger agreement, the failure of the closing conditions included in the merger agreement to be satisfied, or any other failure to consummate the proposed transaction; (x) any negative effects of the announcement of the proposed transaction of the financing thereof on the market price of the Company common stock or other securities; (xi) the industry may be subject to future risks including those set forth in the “Risk Factors” section in the Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q, and in the other filings with the SEC by each of the Company and H&E; and (xii) Herc may not achieve its valuation or re-rating opportunities. The foregoing list of factors is not exhaustive. Investors should carefully consider the foregoing factors and the other risks and uncertainties that affect the businesses of the Company and H&E, including those described in the Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q and in the other filings with the SEC by each of the Company and H&E. All forward-looking statements are expressly qualified in their entirety by such cautionary statements. We undertake no obligation to update or revise forward-looking statements that have been made to reflect events or circumstances that arise after the date made or to reflect the occurrence of unanticipated events.
Additional Information and Where to Find It
The tender offer described herein has not yet commenced, and this communication is neither an offer to purchase nor a solicitation of an offer to sell shares, nor is it a substitute for any offer materials that the Company and its acquisition subsidiary, HR Merger Sub Inc. (“Merger Sub”), will file with the
In addition to the tender offer materials, the Company and H&E file annual, quarterly and current reports, proxy statements and other information with the SEC, which are available to the public at the SEC’s web site (http://www.sec.gov).
Information Regarding Non-GAAP Financial Measures
In addition to results calculated according to accounting principles generally accepted in
View source version on businesswire.com: https://www.businesswire.com/news/home/20250218587289/en/
For Herc Rentals:
Leslie Hunziker
Senior Vice President
Investor Relations, Communications & Sustainability
leslie.hunziker@hercrentals.com
239-301-1675
Joele Frank, Wilkinson Brimmer Katcher
HRI-media@joelefrank.com
Sam Kahane / 631-413-2426
Tarik Garvey / 609-738-5809
For H&E Equipment Services:
Leslie S. Magee
Chief Financial Officer
225-298-5261
lmagee@he-equipment.com
Jeffrey L. Chastain
Vice President of Investor Relations
225-952-2308
jchastain@he-equipment.com
Source: Herc Holdings Inc.
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