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United Rentals has entered into an agreement to acquire H&E Equipment Services, one of its major competitors, in a deal worth US$4.8 billion, including $1.4 billion in net debt.
The acquisition will create a rental business with total 2023 revenues of $15.7 billion, combining the largest and the sixth largest rental businesses in North America.
United Rentals generated $14.3 billion in revenues in 2023 and ranked top of the global IRN100 rental company list, while H&E’s revenues were $1.4 billion and it was 11th in the IRN100.
The deal could increase United Rentals’ North American market share from around 15% to closer to %16.5-17%.
The board of directors of both companies have unanimously approved the transaction, although the agreement includes a 35-day ‘go-shop’ period to 17 February, during which H&E can consider alternative offers.
If concluded, it will give United Rentals more than 160 branches, around 2,765 employees and a 64,000 unit fleet with an original cost of over $2.9 billion. It will also include a nonrental fleet with an original cost of roughly $230 million.
United said the planned merger, which could close in the first quarter of 2025, is consistent with its “grow the core” strategy and will increase its capacity in key US geographies.
Matthew Flannery, CEO, United Rentals, said it is acquiring a well-run operation that’s primed to benefit from its technology, operations and broad value proposition.
He said, “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 capitalise on best-in-class expertise from both sides.”