Herc Holdings Extends Offer to Buy H&E Equipment Services
Herc Holdings Inc. (NYSE: HRI), a leading North American equipment rental supplier, announced an extension of its tender offer to acquire H&E Equipment Services, Inc. (NASDAQ: HEES), a prominent equipment services company headquartered in Baton Rouge, Louisiana. The move is part of Herc’s strategic expansion and consolidation in the equipment rental market, enhancing its national footprint and capabilities.
The tender offer, initially set to expire at one minute past 11:59 p.m. Eastern Time on May 13, 2025, will now expire at one minute past 11:59 p.m. Eastern Time on May 22, 2025, unless further extended. The extension provides additional time for the satisfaction of the remaining closing conditions, including obtaining all necessary regulatory approvals.
Background of the Acquisition
The tender offer is being made pursuant to a definitive Merger Agreement dated February 19, 2025, signed between Herc Holdings, its wholly owned subsidiary HR Merger Sub, Inc., and H&E Equipment Services. Under the terms of the agreement, Herc is offering a mixed consideration of $78.75 in cash and 0.1287 shares of Herc common stock for each outstanding share of H&E common stock. The offer is being made without interest and is subject to the terms and conditions outlined in the Merger Agreement.
The strategic rationale for the acquisition is to strengthen Herc’s presence in key U.S. markets and enhance its capabilities across multiple equipment categories. H&E’s strong brand reputation, customer relationships, and experienced workforce are expected to complement Herc’s existing network and operational scale.
Offer Extension and Status
Herc stated that the offer extension is necessary to allow time for the satisfaction of all outstanding conditions. These include obtaining antitrust and other regulatory approvals that are standard in transactions of this size and nature.
The company emphasized that no other terms of the offer have changed, and it remains committed to completing the transaction in a timely manner. The transaction has already cleared several procedural hurdles, and the extension is viewed as a routine step in the regulatory and shareholder approval process.
As of the close of business on May 7, 2025, Computershare Trust Company, N.A., acting as the depository and paying agent for the offer, reported that 11,999,305 H&E shares have been validly tendered and not withdrawn, representing approximately 32.73% of the outstanding H&E shares. In addition, 53,759 shares were tendered under guaranteed delivery procedures, accounting for an additional 0.15% of the outstanding shares.
This indicates that a substantial number of H&E shareholders have already accepted the offer, which is an encouraging sign for Herc as it moves toward finalizing the acquisition.
Terms of the Tender Offer
The full terms and conditions of the offer are detailed in the Prospectus/Offer to Exchange dated March 19, 2025 (as amended), the Letter of Transmittal, and other related documents. These were filed with the U.S. Securities and Exchange Commission (SEC) under the Tender Offer Statement on Schedule TO and are available for public inspection.
The completion of the offer is subject to customary conditions, including:
- The valid tender (and not withdrawal) of a majority of the outstanding H&E shares.
- Regulatory approvals under U.S. antitrust laws and other applicable jurisdictions.
- No occurrence of a material adverse change in H&E’s business operations.
- Compliance with all other conditions specified in the Offer documentation.
Shareholders of H&E are encouraged to review all offer materials in detail and consult their financial advisors regarding participation.
Strategic Implications of the Merger
The proposed acquisition is expected to be immediately accretive to Herc’s earnings and cash flow upon closing. Combining Herc’s strong national infrastructure and H&E’s robust regional presence will create one of the most comprehensive equipment rental networks in North America.
H&E Equipment Services, founded in 1961, has a broad portfolio of equipment solutions including earthmoving equipment, cranes, aerial lifts, and material handling equipment. The company serves a wide range of industries including construction, manufacturing, energy, and government.
Herc, meanwhile, has grown into one of the top equipment rental firms in the U.S., operating over 360 locations across North America with a focus on delivering high-performance solutions across a wide array of sectors. The acquisition will expand Herc’s fleet, geographic reach, and customer base, allowing it to provide more localized and specialized services.
“H&E’s team and culture are a strong fit with Herc’s, and we’re excited about the opportunity to bring our businesses together,” said Larry Silber, President and CEO of Herc Holdings, in the initial merger announcement. “Together, we will be well-positioned to deliver enhanced value to customers, employees, and shareholders.”
Market and Investor Reactions
The market response to the announcement has been generally positive, with analysts noting that the deal aligns with ongoing consolidation trends in the equipment rental industry. As infrastructure spending increases and private construction rebounds, demand for flexible, high-capacity equipment rental solutions is expected to grow, further justifying the strategic fit of the transaction.
Investors are also monitoring how the combination may result in cost synergies, operational efficiencies, and enhanced fleet utilization. Herc anticipates achieving back-office integration and procurement savings, along with enhanced purchasing power and cross-selling opportunities.
Next Steps and Timeline
With the offer now extended to May 22, 2025, Herc will continue its efforts to satisfy all remaining regulatory and procedural requirements. Assuming conditions are met, the transaction is expected to close shortly after the expiration of the tender offer.
Upon successful completion of the tender offer, any remaining untendered H&E shares would be acquired through a second-step merger, at the same price and terms as the tender offer consideration.
Shareholders of both companies will be kept informed through SEC filings and investor relations channels. Herc advises H&E shareholders to stay updated and consider tendering their shares before the revised deadline.
