Beacon Roofing is target of $11B acquisition bid

Herndon-based Fortune 500 company Beacon Roofing Supply is in discussions to be acquired by Connecticut software and tech services company QXO in a deal valued at about $11 billion.

“It’s not a done deal yet, but we’re in friendly discussions,” Joe Checkler, a spokesperson for QXO, said of the move to acquire Beacon, a roofing and building supplies distributor.

QXO is offering $124.35 per share in cash for Beacon. QXO began the acquisition attempt in November with an unsolicited bid of $124.25 per share, which the Fortune 500 roofing products company had described as “an opportunistic attempt to take advantage of the current macro environment and acquire Beacon at a discount to its intrinsic value for the benefit of QXO but the detriment of Beacon’s shareholders.”

Beacon Roofing Supply declined to comment Monday.

Checkler said Beacon is attractive to QXO because the company “is levered to the big secular growth themes.” He noted that the average commercial building is more than 50 years old, while the average home is more than 40 years old. In 2022, the U.S. housing shortage grew to 4.5 million homes, according to a 2024 analysis from Zillow.

“Plus, 80% of Beacon’s business is repair and remodeling, which is highly stable,” Checkler said. “It’s nondiscretionary and less cyclical. Replacing a leaking roof or a damaged roof is a necessity, not a decision someone has to make.”

Brad Jacobs, founder and CEO of QXO, wrote an open letter to Beacon employees, which he posted to LinkedIn Friday. In it, he explains that if the acquisition is successful one of QXO’s first steps will be to embark on a workers listening tour.

“My teams and I have completed around 500 acquisitions across different industries, and in every case, we’ve discovered a huge wealth of fantastic ideas from employees — ideas that, when acted upon, made the business much stronger,” Jacobs wrote. “Tapping into all those extremely valuable ideas is actually the most important secret of our success.”

Beacon, which distributes building products like roofing, siding and waterproofing materials, is postponing its investor day event, which had been scheduled for Thursday.

The two companies cautioned in a joint news release that the discussions won’t necessarily result in a transaction.

Founded in 1928, Beacon ranks No. 429 on the Fortune 500 list. The company has about 8,000 employees and operates over 580 branches throughout all 50 states and seven provinces in Canada. Julian Francis, Beacon’s president and CEO, joined the company in 2019 after previously leading the insulation business at Owens Corning.

In 2024, Beacon reported net sales of $9.76 billion, a 7.1% increase over the prior year. The Herndon company has been on a growth streak of its own, opening new locations in multiple states and racking up a list of acquisitions, including an announcement last week of the purchase of DM Figley Co., a California wholesale distributor of sealants, waterproofing and concrete repair materials.