10:59 AM EST, 02/18/2025 (MT Newswires) -- H&E Equipment Services ( HEES ) received a superior acquisition offer from Herc Holdings ( HRI ) , giving it the option to terminate its proposed acquisition deal with United Rentals ( URI ) , which does not plan to submit a revised bid, the companies said in separate Tuesday statements.

Herc ( HRI ) has proposed to buy H&E at a total value of about $104.89 per share, including $78.75 in cash and 0.1287 shares of Herc ( HRI ) for each share held by H&E investors. H&E said separately that the combination of cash and stock is equal to $104.59 a share based on Herc's ( HRI ) closing price on Friday.

Last month, United Rentals ( URI ) struck a roughly $4.8 billion all-cash deal to acquire H&E, including about $1.4 billion of debt. The deal also included a 35-day "go-shop" period until Feb. 17 during which H&E could terminate the transaction in favor of a superior alternative acquisition proposal.

Herc's ( HRI ) offer represents a 14% premium to United Rentals' ( URI ) bid to buy H&E for $92 per share in cash, the company said in its statement. United Rentals ( URI ) said it was informed by H&E about Herc's ( HRI ) proposal and decided not to submit an improved offer to acquire the company.

"Our decision not to increase our offer for H&E reflects our commitment to financial discipline," United Rentals ( URI ) Chief Executive Matthew Flannery said. "We will continue to follow our well-proven strategy focused on profitable growth." United Rentals ( URI ) plans to immediately relaunch its share repurchase program once the deal with H&E is terminated.

H&E said it's not allowed to finalize an agreement with Herc ( HRI ) until it meets certain conditions of the United Rentals ( URI ) merger. The company, which will have to pay a termination fee of about $63.5 million to United Rentals ( URI ), plans to meet these requirements on or about Wednesday.

Shares of H&E jumped 13% in Tuesday's trading session while Herc ( HRI ) and United Rentals ( URI ) declined 13% and 3.4%, respectively.

"We are pursuing the proposed combination with H&E from a position of strength and view it as a path to accelerate Herc's ( HRI ) strategy and growth trajectory," Herc ( HRI ) CEO Larry Silber said. "This combination would strengthen Herc's ( HRI ) position as a premier rental company in North America."

Upon termination of the United Rentals-H&E deal and a definitive merger agreement with H&E, Herc ( HRI ) aims to launch a tender offer to acquire all H&E's shares at the said terms. The transaction is expected to be completed in the middle of 2025, subject to a majority of H&E's shares being tendered as well as clearance from regulators, according to Herc ( HRI ). Following completion, H&E's shareholders will hold a roughly 14.1% stake in the combined company.

"By combining our companies, we would unlock substantial upside opportunity for both Herc ( HRI ) and H&E shareholders," according to Silber. Herc ( HRI ) estimates the proposed acquisition to be accretive to its earnings in the high-single-digit range on a per-share basis in 2026, with the impact expected to increase to 20% once synergies are fully realized.

Price: 98.22, Change: +10.94, Percent Change: +12.53