United Rentals Signs Massive $4.8B Deal to Acquire H&E Equipment Services

Equipment rental company United Rentals (URI) signed a $4.8 billion deal with H&E Equipment Services (HEES) to acquire the integrated equipment services company. The agreement will have United Rentals paying $92 per share in cash for HEES stock, representing a roughly 109.34% premium over the stock’s prior closing price.

United Rentals notes that the total enterprise value of its deal with H&E Equipment Services is $4.9 billion, including $1.4 billion of debt held by HEES. The company says the benefits of the acquisition are expanding its rental fleet by 64,000 units and annual synergies of $130 million within 24 months of closing the deal.

United Rentals will use a tender offer to acquire HEES stock, which is set to start by Jan. 28, 2025. The two companies expect the deal to close in Q1 2025. United Rentals also says it will update its 2025 financial outlook after the acquisition closes.

What This Means for URI and HEES Stock

United Rentals investors are excited about today’s news with the stock gaining 4.33% as of this writing. At the same time, shares of HEES stock have rocketed 105.8% higher today. This shows that shareholders on both sides favor the two companies combining.

When United Rentals completes its acquisition of H&E Equipment Services, the latter will no longer be a publicly traded company. As a result, shares of HEES stock will stop trading on the Nasdaq Exchange. Investors who don’t partake in the tender offer will still see their shares acquired by United Rental for $92 in cash.

Is URI Stock a Buy, Sell, or Hold?

Turning to Wall Street, the analysts’ consensus rating for United Rentals is Hold based on five Buy, five Hold, and two Sell ratings over the last three months. With that comes an average price target of $820, a high of $1,004, and a low of $565. This represents a potential 14.17% upside for URI shares.

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