On Wednesday, QXO Inc. (NYSE:QXO) CEO and Chairman Brad Jacobs addressed what he described as misleading and inaccurate claims made by takeover target Beacon (NASDAQ:BECN) in a recent press release. The response follows QXO's second extension of its tender offer for Beacon at $124.25 per share in cash.
Jacobs took to LinkedIn to express his concerns, stating that contrary to Beacon's assertions, the company did provide "crystal clear" Q1 2025 guidance that led to a downward revision of estimates by sell-side analysts. Following Beacon's update, consensus estimates for Q1 EBITDA dropped from $117 million to $74 million, and revenue forecasts decreased from $2.0 billion to $1.83 billion, he notes. Jacobs pointed out that Beacon's Q4 performance fell short of expectations and their Q1 guidance was "a whopping 40% below consensus estimates at the time."
Furthermore, Jacobs contested Beacon's claim of being open to meetings. He noted that QXO has been attempting to engage with Beacon since July 2024 without success, as Beacon has refused to meet without a standstill agreement in place. This agreement would prevent QXO from communicating its offer to Beacon shareholders. Jacobs emphasized that QXO has moved forward by nominating a new board slate to replace the current directors. The tender offer remains open through Monday.
Regarding Beacon's stance that QXO's offer undervalues the company, Jacobs argued that the market's reaction suggests otherwise. Beacon's shares are trading around 10% below the offer price, and QXO's bid represents a 37% premium over Beacon's 90-day unaffected volume-weighted average price (VWAP) as of November 15, 2024. He added that since the offer, the S&P 1500 Trading Companies&Distributors Index has declined by 15%, and the median stock price of Beacon's peers in building products has fallen even more, by 20%. Jacobs concluded that if not for QXO's offer, Beacon's unaffected share price could be considerably lower.
