United Rentals expands U.S. footprint with $4.8 billion H&E Equipment acquisition
The transaction follows United’s growth strategy and provides attractive risk-adjusted returns for the equipment rental company
United Rentals has acquired H&E Equipment Services for $92 per share in cash, reflecting a total enterprise value of approximately $4.8 billion, including approximately $1.4 billion of net debt.
"In H&E we're acquiring a well-run operation that's primed to benefit from our technology, operations, and broad value proposition," says Matthew Flannery, chief executive officer of United Rentals. "Most importantly, we're gaining a great team that shares our intense focus on safety and customer service. We'll be working side-by-side throughout the integration to capitalize on best-in-class expertise from both sides."
Gaining a comprehensive fleet of equipment
Founded in 1961, H&E is a provider of a comprehensive mix of high-quality general rental fleet including aerial work platforms, earthmoving equipment, material handling equipment, and other general and specialty lines of equipment. With approximately 2,900 employees and $2.9 billion of rental fleet at original cost, the company serves a diverse mix of customers across both construction and industrial markets through its network of approximately 160 branches in over 30 U.S. states.
"This purchase of H&E supports our strategy to deploy capital to grow the core business and drive shareholder value," adds Flannery. "This acquisition allows us to better serve our customers with expanded capacity in key markets while also providing the opportunity to further drive revenue through our proven cross-selling strategy. Not only does the agreement satisfy the rigorous strategic, financial, and cultural standards we set for acquisitions, but it also drives attractive returns for our shareholders."
Expanding access to specialty rental offerings
The transaction is consistent with United Rentals' "grow the core" strategy, and legacy H&E contractors will have access to United Rentals' specialty rental offerings across fluid solutions, matting solutions, onsite services, portable storage and modular space, power and HVAC, tool solutions, and trench safety. The acquisition will expand United Rentals' rental fleet by almost 64,000 units.
"I'm extremely proud of what we've built at H&E over the last 60 years and am confident that our combination with United Rentals will take the business to new heights going forward," says Bradley W. Barber, chief executive officer of H&E.
